Correlation Between Okta and Golan Plastic
Can any of the company-specific risk be diversified away by investing in both Okta and Golan Plastic 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 Golan Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Golan Plastic, you can compare the effects of market volatilities on Okta and Golan Plastic 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 Golan Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Golan Plastic.
Diversification Opportunities for Okta and Golan Plastic
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Okta and Golan is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Golan Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golan Plastic 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 Golan Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golan Plastic has no effect on the direction of Okta i.e., Okta and Golan Plastic go up and down completely randomly.
Pair Corralation between Okta and Golan Plastic
Given the investment horizon of 90 days Okta Inc is expected to under-perform the Golan Plastic. But the stock apears to be less risky and, when comparing its historical volatility, Okta Inc is 1.45 times less risky than Golan Plastic. The stock trades about -0.02 of its potential returns per unit of risk. The Golan Plastic is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 91,430 in Golan Plastic on August 29, 2024 and sell it today you would earn a total of 22,970 from holding Golan Plastic or generate 25.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.88% |
| Values | Daily Returns |
Okta Inc vs. Golan Plastic
Performance |
| Timeline |
| Okta Inc |
| Golan Plastic |
Okta and Golan Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Golan Plastic
The main advantage of trading using opposite Okta and Golan Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Golan Plastic 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 Golan Plastic will offset losses from the drop in Golan Plastic's long position.The idea behind Okta Inc and Golan Plastic 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.| Golan Plastic vs. Ormat Technologies | Golan Plastic vs. Multi Retail Group | Golan Plastic vs. Nova | Golan Plastic vs. B Communications |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |