Correlation Between Mr Cooper and Ocwen Financial
Can any of the company-specific risk be diversified away by investing in both Mr Cooper and Ocwen Financial 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 Mr Cooper and Ocwen Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mr Cooper Group and Ocwen Financial, you can compare the effects of market volatilities on Mr Cooper and Ocwen Financial 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 Mr Cooper with a short position of Ocwen Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mr Cooper and Ocwen Financial.
Diversification Opportunities for Mr Cooper and Ocwen Financial
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between COOP and Ocwen is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Mr Cooper Group and Ocwen Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocwen Financial and Mr Cooper 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 Mr Cooper Group are associated (or correlated) with Ocwen Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocwen Financial has no effect on the direction of Mr Cooper i.e., Mr Cooper and Ocwen Financial go up and down completely randomly.
Pair Corralation between Mr Cooper and Ocwen Financial
If you would invest 5,969 in Mr Cooper Group on August 24, 2024 and sell it today you would earn a total of 3,864 from holding Mr Cooper Group or generate 64.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
Mr Cooper Group vs. Ocwen Financial
Performance |
| Timeline |
| Mr Cooper Group |
| Ocwen Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Mr Cooper and Ocwen Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mr Cooper and Ocwen Financial
The main advantage of trading using opposite Mr Cooper and Ocwen Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mr Cooper position performs unexpectedly, Ocwen Financial 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 Ocwen Financial will offset losses from the drop in Ocwen Financial's long position.| Mr Cooper vs. Guild Holdings Co | Mr Cooper vs. Encore Capital Group | Mr Cooper vs. CNFinance Holdings | Mr Cooper vs. Velocity Financial Llc |
| Ocwen Financial vs. CNFinance Holdings | Ocwen Financial vs. Security National Financial | Ocwen Financial vs. Encore Capital Group | Ocwen Financial vs. Guild Holdings 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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