Correlation Between BIT Computer and Oscotec

Can any of the company-specific risk be diversified away by investing in both BIT Computer and Oscotec 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 BIT Computer and Oscotec into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BIT Computer Co and Oscotec, you can compare the effects of market volatilities on BIT Computer and Oscotec 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 BIT Computer with a short position of Oscotec. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIT Computer and Oscotec.

Diversification Opportunities for BIT Computer and Oscotec

0.34

Correlation Coefficient

BIT Computer  Oscotec

Weak diversification

The 3 months correlation between BIT and Oscotec is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding BIT Computer Co and Oscotec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oscotec and BIT Computer 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 BIT Computer Co are associated (or correlated) with Oscotec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oscotec has no effect on the direction of BIT Computer i.e., BIT Computer and Oscotec go up and down completely randomly.

Pair Corralation between BIT Computer and Oscotec

Assuming the 90 days trading horizon BIT Computer is expected to generate 12.34 times less return on investment than Oscotec. But when comparing it to its historical volatility, BIT Computer Co is 1.35 times less risky than Oscotec. It trades about 0.0 of its potential returns per unit of risk. Oscotec is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,730,000  in Oscotec on October 9, 2024 and sell it today you would earn a total of  700,000  from holding Oscotec or generate 40.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.8%
Values	Daily Returns

BIT Computer Co  vs.  Oscotec

BIT Computer

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BIT Computer Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, BIT Computer is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Oscotec

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oscotec has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with BIT Computer and Oscotec

The main advantage of trading using opposite BIT Computer and Oscotec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIT Computer position performs unexpectedly, Oscotec 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 Oscotec will offset losses from the drop in Oscotec's long position.

The idea behind BIT Computer Co and Oscotec 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.

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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..