Correlation Between Okta and Amprius Technologies
Can any of the company-specific risk be diversified away by investing in both Okta and Amprius Technologies 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 Amprius Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Amprius Technologies, you can compare the effects of market volatilities on Okta and Amprius Technologies 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 Amprius Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Amprius Technologies.
Diversification Opportunities for Okta and Amprius Technologies
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Okta and Amprius is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Amprius Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amprius Technologies 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 Amprius Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amprius Technologies has no effect on the direction of Okta i.e., Okta and Amprius Technologies go up and down completely randomly.
Pair Corralation between Okta and Amprius Technologies
Given the investment horizon of 90 days Okta is expected to generate 11.39 times less return on investment than Amprius Technologies. But when comparing it to its historical volatility, Okta Inc is 7.29 times less risky than Amprius Technologies. It trades about 0.13 of its potential returns per unit of risk. Amprius Technologies is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 139.00 in Amprius Technologies on August 27, 2024 and sell it today you would earn a total of 65.00 from holding Amprius Technologies or generate 46.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Okta Inc vs. Amprius Technologies
Performance |
| Timeline |
| Okta Inc |
| Amprius Technologies |
Okta and Amprius Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Amprius Technologies
The main advantage of trading using opposite Okta and Amprius Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Amprius Technologies 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 Amprius Technologies will offset losses from the drop in Amprius Technologies' long position.The idea behind Okta Inc and Amprius Technologies 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.| Amprius Technologies vs. Eos Energy Enterprises | Amprius Technologies vs. FREYR Battery SA | Amprius Technologies vs. Microvast Holdings | Amprius Technologies vs. Chardan NexTech Acquisition |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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