Correlation Between De Grey and OPKO HEALTH
Can any of the company-specific risk be diversified away by investing in both De Grey and OPKO HEALTH 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 De Grey and OPKO HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between De Grey Mining and OPKO HEALTH, you can compare the effects of market volatilities on De Grey and OPKO HEALTH 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 De Grey with a short position of OPKO HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Grey and OPKO HEALTH.
Diversification Opportunities for De Grey and OPKO HEALTH
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between DGD and OPKO is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding De Grey Mining and OPKO HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPKO HEALTH and De Grey 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 De Grey Mining are associated (or correlated) with OPKO HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPKO HEALTH has no effect on the direction of De Grey i.e., De Grey and OPKO HEALTH go up and down completely randomly.
Pair Corralation between De Grey and OPKO HEALTH
Assuming the 90 days trading horizon De Grey Mining is expected to generate 1.16 times more return on investment than OPKO HEALTH. However, De Grey is 1.16 times more volatile than OPKO HEALTH. It trades about 0.04 of its potential returns per unit of risk. OPKO HEALTH is currently generating about 0.03 per unit of risk. If you would invest 86.00 in De Grey Mining on November 7, 2024 and sell it today you would earn a total of 32.00 from holding De Grey Mining or generate 37.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
De Grey Mining vs. OPKO HEALTH
Performance |
| Timeline |
| De Grey Mining |
| OPKO HEALTH |
De Grey and OPKO HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with De Grey and OPKO HEALTH
The main advantage of trading using opposite De Grey and OPKO HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Grey position performs unexpectedly, OPKO HEALTH 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 OPKO HEALTH will offset losses from the drop in OPKO HEALTH's long position.| De Grey vs. American Airlines Group | De Grey vs. Burlington Stores | De Grey vs. BURLINGTON STORES | De Grey vs. SIEM OFFSHORE NEW |
| OPKO HEALTH vs. DATANG INTL POW | OPKO HEALTH vs. Columbia Sportswear | OPKO HEALTH vs. Datadog | OPKO HEALTH vs. NTT DATA |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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