Correlation Between Stratasys and IONQ

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

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

Diversification Opportunities for Stratasys and IONQ

-0.01

Correlation Coefficient

Stratasys  IONQ

Good diversification

The 3 months correlation between Stratasys and IONQ is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Stratasys and IONQ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IONQ Inc and Stratasys 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 Stratasys are associated (or correlated) with IONQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IONQ Inc has no effect on the direction of Stratasys i.e., Stratasys and IONQ go up and down completely randomly.

Pair Corralation between Stratasys and IONQ

Given the investment horizon of 90 days Stratasys is expected to generate 0.43 times more return on investment than IONQ. However, Stratasys is 2.33 times less risky than IONQ. It trades about 0.06 of its potential returns per unit of risk. IONQ Inc is currently generating about 0.02 per unit of risk. If you would invest  962.00  in Stratasys on November 28, 2024 and sell it today you would earn a total of  108.00  from holding Stratasys or generate 11.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Stratasys  vs.  IONQ Inc

Stratasys

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Stratasys are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Stratasys unveiled solid returns over the last few months and may actually be approaching a breakup point.

IONQ Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in IONQ Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, IONQ may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Stratasys and IONQ

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

The idea behind Stratasys and IONQ Inc 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.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.