Correlation Between Okta and GI Group
Can any of the company-specific risk be diversified away by investing in both Okta and GI Group 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 GI Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and GI Group Poland, you can compare the effects of market volatilities on Okta and GI Group 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 GI Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and GI Group.
Diversification Opportunities for Okta and GI Group
Modest diversification
The 3 months correlation between Okta and GIG is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and GI Group Poland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GI Group Poland 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 GI Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GI Group Poland has no effect on the direction of Okta i.e., Okta and GI Group go up and down completely randomly.
Pair Corralation between Okta and GI Group
Given the investment horizon of 90 days Okta Inc is expected to generate 1.15 times more return on investment than GI Group. However, Okta is 1.15 times more volatile than GI Group Poland. It trades about 0.02 of its potential returns per unit of risk. GI Group Poland is currently generating about 0.01 per unit of risk. If you would invest 7,145 in Okta Inc on August 31, 2024 and sell it today you would earn a total of 611.00 from holding Okta Inc or generate 8.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Okta Inc vs. GI Group Poland
Performance |
| Timeline |
| Okta Inc |
| GI Group Poland |
Okta and GI Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and GI Group
The main advantage of trading using opposite Okta and GI Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, GI Group 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 GI Group will offset losses from the drop in GI Group's long position.The idea behind Okta Inc and GI Group Poland 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.| GI Group vs. Movie Games SA | GI Group vs. Gamedust SA | GI Group vs. mBank SA | GI Group vs. Biztech Konsulting SA |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Commodity Directory Find actively traded commodities issued by global exchanges |