Correlation Between OBI Pharma and Wowprime Corp
Can any of the company-specific risk be diversified away by investing in both OBI Pharma and Wowprime Corp 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 OBI Pharma and Wowprime Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OBI Pharma and Wowprime Corp, you can compare the effects of market volatilities on OBI Pharma and Wowprime Corp 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 OBI Pharma with a short position of Wowprime Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of OBI Pharma and Wowprime Corp.
Diversification Opportunities for OBI Pharma and Wowprime Corp
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OBI and Wowprime is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding OBI Pharma and Wowprime Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wowprime Corp and OBI Pharma 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 OBI Pharma are associated (or correlated) with Wowprime Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wowprime Corp has no effect on the direction of OBI Pharma i.e., OBI Pharma and Wowprime Corp go up and down completely randomly.
Pair Corralation between OBI Pharma and Wowprime Corp
Assuming the 90 days trading horizon OBI Pharma is expected to generate 1.07 times more return on investment than Wowprime Corp. However, OBI Pharma is 1.07 times more volatile than Wowprime Corp. It trades about -0.04 of its potential returns per unit of risk. Wowprime Corp is currently generating about -0.06 per unit of risk. If you would invest 8,900 in OBI Pharma on August 31, 2024 and sell it today you would lose (2,710) from holding OBI Pharma or give up 30.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
OBI Pharma vs. Wowprime Corp
Performance |
| Timeline |
| OBI Pharma |
| Wowprime Corp |
OBI Pharma and Wowprime Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OBI Pharma and Wowprime Corp
The main advantage of trading using opposite OBI Pharma and Wowprime Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OBI Pharma position performs unexpectedly, Wowprime Corp 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 Wowprime Corp will offset losses from the drop in Wowprime Corp's long position.| OBI Pharma vs. TaiMed Biologics | OBI Pharma vs. PharmaEngine | OBI Pharma vs. Medigen Biotechnology | OBI Pharma vs. TTY Biopharm Co |
| Wowprime Corp vs. Chaintech Technology Corp | Wowprime Corp vs. AVerMedia Technologies | Wowprime Corp vs. Avision | Wowprime Corp vs. Clevo Co |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |