Correlation Between Okta and BANK HANDLOWY
Can any of the company-specific risk be diversified away by investing in both Okta and BANK HANDLOWY 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 Okta and BANK HANDLOWY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and BANK HANDLOWY, you can compare the effects of market volatilities on Okta and BANK HANDLOWY 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 Okta with a short position of BANK HANDLOWY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and BANK HANDLOWY.
Diversification Opportunities for Okta and BANK HANDLOWY
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Okta and BANK is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and BANK HANDLOWY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK HANDLOWY and Okta 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 Okta Inc are associated (or correlated) with BANK HANDLOWY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK HANDLOWY has no effect on the direction of Okta i.e., Okta and BANK HANDLOWY go up and down completely randomly.
Pair Corralation between Okta and BANK HANDLOWY
Given the investment horizon of 90 days Okta Inc is expected to under-perform the BANK HANDLOWY. But the stock apears to be less risky and, when comparing its historical volatility, Okta Inc is 2.21 times less risky than BANK HANDLOWY. The stock trades about -0.06 of its potential returns per unit of risk. The BANK HANDLOWY is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,429 in BANK HANDLOWY on August 27, 2024 and sell it today you would earn a total of 601.00 from holding BANK HANDLOWY or generate 42.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Okta Inc vs. BANK HANDLOWY
Performance |
| Timeline |
| Okta Inc |
| BANK HANDLOWY |
Okta and BANK HANDLOWY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and BANK HANDLOWY
The main advantage of trading using opposite Okta and BANK HANDLOWY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, BANK HANDLOWY 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 BANK HANDLOWY will offset losses from the drop in BANK HANDLOWY's long position.The idea behind Okta Inc and BANK HANDLOWY 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.| BANK HANDLOWY vs. TIANDE CHEMICAL | BANK HANDLOWY vs. ECHO INVESTMENT ZY | BANK HANDLOWY vs. MGIC INVESTMENT | BANK HANDLOWY vs. Marie Brizard Wine |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |