Correlation Between OraSure Technologies and AngioDynamics

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

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

Diversification Opportunities for OraSure Technologies and AngioDynamics

-0.37

Correlation Coefficient

OraSure Technologies  AngioDynamics

Very good diversification

The 3 months correlation between OraSure and AngioDynamics is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding OraSure Technologies and AngioDynamics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AngioDynamics and OraSure Technologies 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 OraSure Technologies are associated (or correlated) with AngioDynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AngioDynamics has no effect on the direction of OraSure Technologies i.e., OraSure Technologies and AngioDynamics go up and down completely randomly.

Pair Corralation between OraSure Technologies and AngioDynamics

Given the investment horizon of 90 days OraSure Technologies is expected to under-perform the AngioDynamics. But the stock apears to be less risky and, when comparing its historical volatility, OraSure Technologies is 1.1 times less risky than AngioDynamics. The stock trades about -0.22 of its potential returns per unit of risk. The AngioDynamics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  600.00  in AngioDynamics on January 24, 2024 and sell it today you would earn a total of  26.00  from holding AngioDynamics or generate 4.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

OraSure Technologies  vs.  AngioDynamics

OraSure Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OraSure Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in May 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

AngioDynamics

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AngioDynamics are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, AngioDynamics may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Pair Trading with OraSure Technologies and AngioDynamics

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

The idea behind OraSure Technologies and AngioDynamics 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..