Correlation Between Okta and Bangkok Ranch
Can any of the company-specific risk be diversified away by investing in both Okta and Bangkok Ranch 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 Bangkok Ranch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Bangkok Ranch PCL, you can compare the effects of market volatilities on Okta and Bangkok Ranch 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 Bangkok Ranch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Bangkok Ranch.
Diversification Opportunities for Okta and Bangkok Ranch
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Okta and Bangkok is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Bangkok Ranch PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bangkok Ranch PCL 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 Bangkok Ranch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bangkok Ranch PCL has no effect on the direction of Okta i.e., Okta and Bangkok Ranch go up and down completely randomly.
Pair Corralation between Okta and Bangkok Ranch
Given the investment horizon of 90 days Okta Inc is expected to generate 2.21 times more return on investment than Bangkok Ranch. However, Okta is 2.21 times more volatile than Bangkok Ranch PCL. It trades about 0.03 of its potential returns per unit of risk. Bangkok Ranch PCL is currently generating about -0.07 per unit of risk. If you would invest 6,166 in Okta Inc on August 28, 2024 and sell it today you would earn a total of 1,484 from holding Okta Inc or generate 24.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.17% |
| Values | Daily Returns |
Okta Inc vs. Bangkok Ranch PCL
Performance |
| Timeline |
| Okta Inc |
| Bangkok Ranch PCL |
Okta and Bangkok Ranch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Bangkok Ranch
The main advantage of trading using opposite Okta and Bangkok Ranch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Bangkok Ranch 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 Bangkok Ranch will offset losses from the drop in Bangkok Ranch's long position.The idea behind Okta Inc and Bangkok Ranch PCL 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.| Bangkok Ranch vs. GFPT Public | Bangkok Ranch vs. Asian Sea | Bangkok Ranch vs. Buriram Sugar Public | Bangkok Ranch vs. Ichitan Group Public |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |