Correlation Between NYSE Composite and Opko Health
Can any of the company-specific risk be diversified away by investing in both NYSE Composite 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 NYSE Composite and Opko Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Opko Health, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of Opko Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Opko Health.
Diversification Opportunities for NYSE Composite and Opko Health
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Opko is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Opko Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opko Health 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 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 NYSE Composite i.e., NYSE Composite and Opko Health go up and down completely randomly.
Pair Corralation between NYSE Composite and Opko Health
Assuming the 90 days trading horizon NYSE Composite is expected to under-perform the Opko Health. But the index apears to be less risky and, when comparing its historical volatility, NYSE Composite is 3.73 times less risky than Opko Health. The index trades about -0.02 of its potential returns per unit of risk. The Opko Health is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 147.00 in Opko Health on November 28, 2024 and sell it today you would earn a total of 17.00 from holding Opko Health or generate 11.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Opko Health
Performance |
| Timeline |
NYSE Composite and Opko Health Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Opko Health
Pair trading matchups for Opko Health
Pair Trading with NYSE Composite and Opko Health
The main advantage of trading using opposite NYSE Composite and Opko Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.| NYSE Composite vs. Inter Parfums | NYSE Composite vs. Amkor Technology | NYSE Composite vs. Unilever PLC ADR | NYSE Composite vs. Estee Lauder Companies |
| Opko Health vs. Caredx Inc | Opko Health vs. Castle Biosciences | Opko Health vs. Twist Bioscience Corp | Opko Health vs. Biodesix |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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