Correlation Between Weyco and OSI Systems
Can any of the company-specific risk be diversified away by investing in both Weyco and OSI Systems at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Weyco and OSI Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and OSI Systems, you can compare the effects of market volatilities on Weyco and OSI Systems and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Weyco with a short position of OSI Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and OSI Systems.
Diversification Opportunities for Weyco and OSI Systems
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Weyco and OSI is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and OSI Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSI Systems and Weyco is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Weyco Group are associated (or correlated) with OSI Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSI Systems has no effect on the direction of Weyco i.e., Weyco and OSI Systems go up and down completely randomly.
Pair Corralation between Weyco and OSI Systems
Given the investment horizon of 90 days Weyco Group is expected to generate 0.93 times more return on investment than OSI Systems. However, Weyco Group is 1.08 times less risky than OSI Systems. It trades about 0.1 of its potential returns per unit of risk. OSI Systems is currently generating about 0.06 per unit of risk. If you would invest 2,811 in Weyco Group on April 24, 2025 and sell it today you would earn a total of 342.00 from holding Weyco Group or generate 12.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weyco Group vs. OSI Systems
Performance |
| Timeline |
| Weyco Group |
| OSI Systems |
Weyco and OSI Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weyco and OSI Systems
The main advantage of trading using opposite Weyco and OSI Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, OSI Systems can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in OSI Systems will offset losses from the drop in OSI Systems' long position.The idea behind Weyco Group and OSI Systems pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| OSI Systems vs. Sanmina | OSI Systems vs. Benchmark Electronics | OSI Systems vs. Methode Electronics | OSI Systems vs. Celestica |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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