Correlation Between Ault Alliance and Opthea
Can any of the company-specific risk be diversified away by investing in both Ault Alliance and Opthea 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 Ault Alliance and Opthea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ault Alliance and Opthea, you can compare the effects of market volatilities on Ault Alliance and Opthea 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 Ault Alliance with a short position of Opthea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ault Alliance and Opthea.
Diversification Opportunities for Ault Alliance and Opthea
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ault and Opthea is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ault Alliance and Opthea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opthea and Ault Alliance 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 Ault Alliance are associated (or correlated) with Opthea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Opthea has no effect on the direction of Ault Alliance i.e., Ault Alliance and Opthea go up and down completely randomly.
Pair Corralation between Ault Alliance and Opthea
Given the investment horizon of 90 days Ault Alliance is expected to under-perform the Opthea. In addition to that, Ault Alliance is 1.51 times more volatile than Opthea. It trades about -0.18 of its total potential returns per unit of risk. Opthea is currently generating about -0.01 per unit of volatility. If you would invest 109.00 in Opthea on September 3, 2024 and sell it today you would lose (65.00) from holding Opthea or give up 59.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.48% |
| Values | Daily Returns |
Ault Alliance vs. Opthea
Performance |
| Timeline |
| Ault Alliance |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Opthea |
Ault Alliance and Opthea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ault Alliance and Opthea
The main advantage of trading using opposite Ault Alliance and Opthea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ault Alliance position performs unexpectedly, Opthea 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 Opthea will offset losses from the drop in Opthea's long position.| Ault Alliance vs. Meiwu Technology Co | Ault Alliance vs. Reservoir Media | Ault Alliance vs. Weibo Corp | Ault Alliance vs. NETGEAR |
| Opthea vs. Here Media | Opthea vs. Playtika Holding Corp | Opthea vs. Playtech plc | Opthea vs. Modine Manufacturing |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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