Correlation Between Easy Software and OPKO HEALTH
Can any of the company-specific risk be diversified away by investing in both Easy Software 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 Easy Software and OPKO HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Easy Software AG and OPKO HEALTH, you can compare the effects of market volatilities on Easy Software 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 Easy Software with a short position of OPKO HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and OPKO HEALTH.
Diversification Opportunities for Easy Software and OPKO HEALTH
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Easy and OPKO is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and OPKO HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPKO HEALTH and Easy Software 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 Easy Software AG 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 Easy Software i.e., Easy Software and OPKO HEALTH go up and down completely randomly.
Pair Corralation between Easy Software and OPKO HEALTH
Assuming the 90 days trading horizon Easy Software AG is expected to under-perform the OPKO HEALTH. In addition to that, Easy Software is 4.42 times more volatile than OPKO HEALTH. It trades about -0.04 of its total potential returns per unit of risk. OPKO HEALTH is currently generating about -0.09 per unit of volatility. If you would invest 146.00 in OPKO HEALTH on October 28, 2024 and sell it today you would lose (2.00) from holding OPKO HEALTH or give up 1.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Easy Software AG vs. OPKO HEALTH
Performance |
| Timeline |
| Easy Software AG |
| OPKO HEALTH |
Easy Software and OPKO HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and OPKO HEALTH
The main advantage of trading using opposite Easy Software and OPKO HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software 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.| Easy Software vs. Ebro Foods SA | Easy Software vs. PURE FOODS TASMANIA | Easy Software vs. Infrastrutture Wireless Italiane | Easy Software vs. Forsys Metals Corp |
| OPKO HEALTH vs. Apple Inc | OPKO HEALTH vs. Apple Inc | OPKO HEALTH vs. Apple Inc | OPKO HEALTH vs. Apple Inc |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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