Correlation Between Blackbaud and Olo
Can any of the company-specific risk be diversified away by investing in both Blackbaud and Olo 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 Blackbaud and Olo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackbaud and Olo Inc, you can compare the effects of market volatilities on Blackbaud and Olo 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 Blackbaud with a short position of Olo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackbaud and Olo.
Diversification Opportunities for Blackbaud and Olo
Modest diversification
The 3 months correlation between Blackbaud and Olo is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Blackbaud and Olo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olo Inc and Blackbaud 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 Blackbaud are associated (or correlated) with Olo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olo Inc has no effect on the direction of Blackbaud i.e., Blackbaud and Olo go up and down completely randomly.
Pair Corralation between Blackbaud and Olo
Given the investment horizon of 90 days Blackbaud is expected to generate 10.57 times less return on investment than Olo. In addition to that, Blackbaud is 1.14 times more volatile than Olo Inc. It trades about 0.04 of its total potential returns per unit of risk. Olo Inc is currently generating about 0.45 per unit of volatility. If you would invest 519.00 in Olo Inc on August 28, 2024 and sell it today you would earn a total of 206.00 from holding Olo Inc or generate 39.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackbaud vs. Olo Inc
Performance |
| Timeline |
| Blackbaud |
| Olo Inc |
Blackbaud and Olo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackbaud and Olo
The main advantage of trading using opposite Blackbaud and Olo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackbaud position performs unexpectedly, Olo 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 Olo will offset losses from the drop in Olo's long position.The idea behind Blackbaud and Olo Inc 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.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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |