Correlation Between Omeros and DEXUS
Can any of the company-specific risk be diversified away by investing in both Omeros and DEXUS 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 Omeros and DEXUS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Omeros and DEXUS, you can compare the effects of market volatilities on Omeros and DEXUS 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 Omeros with a short position of DEXUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omeros and DEXUS.
Diversification Opportunities for Omeros and DEXUS
Very good diversification
The 3 months correlation between Omeros and DEXUS is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Omeros and DEXUS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DEXUS and Omeros 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 Omeros are associated (or correlated) with DEXUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DEXUS has no effect on the direction of Omeros i.e., Omeros and DEXUS go up and down completely randomly.
Pair Corralation between Omeros and DEXUS
Assuming the 90 days horizon Omeros is expected to generate 10.45 times more return on investment than DEXUS. However, Omeros is 10.45 times more volatile than DEXUS. It trades about 0.28 of its potential returns per unit of risk. DEXUS is currently generating about -0.13 per unit of risk. If you would invest 346.00 in Omeros on August 28, 2024 and sell it today you would earn a total of 757.00 from holding Omeros or generate 218.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Omeros vs. DEXUS
Performance |
| Timeline |
| Omeros |
| DEXUS |
Omeros and DEXUS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Omeros and DEXUS
The main advantage of trading using opposite Omeros and DEXUS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omeros position performs unexpectedly, DEXUS 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 DEXUS will offset losses from the drop in DEXUS's long position.| Omeros vs. KB HOME | Omeros vs. Mobilezone Holding AG | Omeros vs. ULTRA CLEAN HLDGS | Omeros vs. Comba Telecom Systems |
| DEXUS vs. Wyndham Hotels Resorts | DEXUS vs. Ultra Clean Holdings | DEXUS vs. MHP Hotel AG | DEXUS vs. ULTRA CLEAN HLDGS |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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