Correlation Between NYSE Composite and OppFi
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and OppFi 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 NYSE Composite and OppFi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and OppFi Inc, you can compare the effects of market volatilities on NYSE Composite and OppFi 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 NYSE Composite with a short position of OppFi. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and OppFi.
Diversification Opportunities for NYSE Composite and OppFi
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and OppFi is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and OppFi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OppFi Inc and NYSE Composite 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 NYSE Composite are associated (or correlated) with OppFi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OppFi Inc has no effect on the direction of NYSE Composite i.e., NYSE Composite and OppFi go up and down completely randomly.
Pair Corralation between NYSE Composite and OppFi
Assuming the 90 days trading horizon NYSE Composite is expected to generate 12.05 times less return on investment than OppFi. But when comparing it to its historical volatility, NYSE Composite is 8.88 times less risky than OppFi. It trades about 0.24 of its potential returns per unit of risk. OppFi Inc is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 539.00 in OppFi Inc on August 28, 2024 and sell it today you would earn a total of 246.00 from holding OppFi Inc or generate 45.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. OppFi Inc
Performance |
| Timeline |
NYSE Composite and OppFi Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
OppFi Inc
Pair trading matchups for OppFi
Pair Trading with NYSE Composite and OppFi
The main advantage of trading using opposite NYSE Composite and OppFi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, OppFi 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 OppFi will offset losses from the drop in OppFi's long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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