Correlation Between Open Lending and Doximity
Can any of the company-specific risk be diversified away by investing in both Open Lending and Doximity 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 Open Lending and Doximity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Open Lending Corp and Doximity, you can compare the effects of market volatilities on Open Lending and Doximity 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 Open Lending with a short position of Doximity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Open Lending and Doximity.
Diversification Opportunities for Open Lending and Doximity
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Open and Doximity is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Open Lending Corp and Doximity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doximity and Open Lending 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 Open Lending Corp are associated (or correlated) with Doximity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doximity has no effect on the direction of Open Lending i.e., Open Lending and Doximity go up and down completely randomly.
Pair Corralation between Open Lending and Doximity
Given the investment horizon of 90 days Open Lending is expected to generate 1.22 times less return on investment than Doximity. But when comparing it to its historical volatility, Open Lending Corp is 1.92 times less risky than Doximity. It trades about 0.2 of its potential returns per unit of risk. Doximity is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4,142 in Doximity on August 28, 2024 and sell it today you would earn a total of 733.00 from holding Doximity or generate 17.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Open Lending Corp vs. Doximity
Performance |
| Timeline |
| Open Lending Corp |
| Doximity |
Open Lending and Doximity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Open Lending and Doximity
The main advantage of trading using opposite Open Lending and Doximity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Open Lending position performs unexpectedly, Doximity 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 Doximity will offset losses from the drop in Doximity's long position.| Open Lending vs. EZCORP Inc | Open Lending vs. Orix Corp Ads | Open Lending vs. SLM Corp | Open Lending vs. Navient Corp |
| Doximity vs. HealthStream | Doximity vs. National Research Corp | Doximity vs. Forian Inc | Doximity vs. HealthEquity |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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