Correlation Between Inotiv and Olink Holding
Can any of the company-specific risk be diversified away by investing in both Inotiv and Olink Holding 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 Inotiv and Olink Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inotiv Inc and Olink Holding AB, you can compare the effects of market volatilities on Inotiv and Olink Holding 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 Inotiv with a short position of Olink Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inotiv and Olink Holding.
Diversification Opportunities for Inotiv and Olink Holding
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Inotiv and Olink is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Inotiv Inc and Olink Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olink Holding AB and Inotiv 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 Inotiv Inc are associated (or correlated) with Olink Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olink Holding AB has no effect on the direction of Inotiv i.e., Inotiv and Olink Holding go up and down completely randomly.
Pair Corralation between Inotiv and Olink Holding
Given the investment horizon of 90 days Inotiv Inc is expected to generate 8.57 times more return on investment than Olink Holding. However, Inotiv is 8.57 times more volatile than Olink Holding AB. It trades about 0.1 of its potential returns per unit of risk. Olink Holding AB is currently generating about 0.42 per unit of risk. If you would invest 217.00 in Inotiv Inc on September 1, 2024 and sell it today you would earn a total of 149.00 from holding Inotiv Inc or generate 68.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 21.43% |
| Values | Daily Returns |
Inotiv Inc vs. Olink Holding AB
Performance |
| Timeline |
| Inotiv Inc |
| Olink Holding AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Inotiv and Olink Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inotiv and Olink Holding
The main advantage of trading using opposite Inotiv and Olink Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inotiv position performs unexpectedly, Olink Holding 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 Olink Holding will offset losses from the drop in Olink Holding's long position.| Inotiv vs. Verve Therapeutics | Inotiv vs. Beam Therapeutics | Inotiv vs. Caribou Biosciences | Inotiv vs. Sana Biotechnology |
| Olink Holding vs. Fonar | Olink Holding vs. Burning Rock Biotech | Olink Holding vs. Sera Prognostics | Olink Holding vs. Psychemedics |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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