Correlation Between Intel and Opthea
Can any of the company-specific risk be diversified away by investing in both Intel 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 Intel and Opthea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Opthea, you can compare the effects of market volatilities on Intel 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 Intel with a short position of Opthea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Opthea.
Diversification Opportunities for Intel and Opthea
Weak diversification
The 3 months correlation between Intel and Opthea is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Opthea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opthea and Intel 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 Intel 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 Intel i.e., Intel and Opthea go up and down completely randomly.
Pair Corralation between Intel and Opthea
Given the investment horizon of 90 days Intel is expected to under-perform the Opthea. But the stock apears to be less risky and, when comparing its historical volatility, Intel is 1.43 times less risky than Opthea. The stock trades about -0.04 of its potential returns per unit of risk. The Opthea is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 180.00 in Opthea on September 1, 2024 and sell it today you would earn a total of 189.00 from holding Opthea or generate 105.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.14% |
| Values | Daily Returns |
Intel vs. Opthea
Performance |
| Timeline |
| Intel |
| Opthea |
Intel and Opthea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Opthea
The main advantage of trading using opposite Intel and Opthea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel 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.| Intel vs. NXP Semiconductors NV | Intel vs. GSI Technology | Intel vs. MaxLinear | Intel vs. Texas Instruments Incorporated |
| Opthea vs. Molecular Partners AG | Opthea vs. MediciNova | Opthea vs. Anebulo Pharmaceuticals | Opthea vs. Champions Oncology |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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