Correlation Between Altigen Communications and Ooma
Can any of the company-specific risk be diversified away by investing in both Altigen Communications and Ooma 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 Altigen Communications and Ooma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altigen Communications and Ooma Inc, you can compare the effects of market volatilities on Altigen Communications and Ooma 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 Altigen Communications with a short position of Ooma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altigen Communications and Ooma.
Diversification Opportunities for Altigen Communications and Ooma
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Altigen and Ooma is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Altigen Communications and Ooma Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ooma Inc and Altigen Communications 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 Altigen Communications are associated (or correlated) with Ooma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ooma Inc has no effect on the direction of Altigen Communications i.e., Altigen Communications and Ooma go up and down completely randomly.
Pair Corralation between Altigen Communications and Ooma
Given the investment horizon of 90 days Altigen Communications is expected to under-perform the Ooma. In addition to that, Altigen Communications is 2.4 times more volatile than Ooma Inc. It trades about -0.1 of its total potential returns per unit of risk. Ooma Inc is currently generating about 0.01 per unit of volatility. If you would invest 1,455 in Ooma Inc on August 28, 2024 and sell it today you would lose (15.00) from holding Ooma Inc or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 9.09% |
| Values | Daily Returns |
Altigen Communications vs. Ooma Inc
Performance |
| Timeline |
| Altigen Communications |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ooma Inc |
Altigen Communications and Ooma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altigen Communications and Ooma
The main advantage of trading using opposite Altigen Communications and Ooma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altigen Communications position performs unexpectedly, Ooma 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 Ooma will offset losses from the drop in Ooma's long position.| Altigen Communications vs. Aware Inc | Altigen Communications vs. Integrated Ventures | Altigen Communications vs. AudioCodes |
| Ooma vs. Shenandoah Telecommunications Co | Ooma vs. Anterix | Ooma vs. Liberty Broadband Corp | Ooma vs. IDT Corporation |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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