Correlation Between O2Micro International and Computer Task

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Can any of the company-specific risk be diversified away by investing in both O2Micro International and Computer Task 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 O2Micro International and Computer Task into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between O2Micro International Limited and Computer Task Group, you can compare the effects of market volatilities on O2Micro International and Computer Task 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 O2Micro International with a short position of Computer Task. Check out your portfolio center. Please also check ongoing floating volatility patterns of O2Micro International and Computer Task.

Diversification Opportunities for O2Micro International and Computer Task

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between O2Micro and Computer is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding O2Micro International Limited and Computer Task Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Task Group and O2Micro International 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 O2Micro International Limited are associated (or correlated) with Computer Task. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Task Group has no effect on the direction of O2Micro International i.e., O2Micro International and Computer Task go up and down completely randomly.

Pair Corralation between O2Micro International and Computer Task

If you would invest (100.00) in Computer Task Group on October 15, 2025 and sell it today you would earn a total of  100.00  from holding Computer Task Group or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

O2Micro International Limited  vs.  Computer Task Group

 Performance 
       Timeline  
O2Micro International 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days O2Micro International Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, O2Micro International is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
Computer Task Group 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Computer Task Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Computer Task is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

O2Micro International and Computer Task Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with O2Micro International and Computer Task

The main advantage of trading using opposite O2Micro International and Computer Task positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if O2Micro International position performs unexpectedly, Computer Task 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 Computer Task will offset losses from the drop in Computer Task's long position.
The idea behind O2Micro International Limited and Computer Task Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

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