Correlation Between Okta and Hubersuhner
Can any of the company-specific risk be diversified away by investing in both Okta and Hubersuhner 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 Hubersuhner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Hubersuhner AG, you can compare the effects of market volatilities on Okta and Hubersuhner 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 Hubersuhner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Hubersuhner.
Diversification Opportunities for Okta and Hubersuhner
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Okta and Hubersuhner is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Hubersuhner AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubersuhner AG 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 Hubersuhner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubersuhner AG has no effect on the direction of Okta i.e., Okta and Hubersuhner go up and down completely randomly.
Pair Corralation between Okta and Hubersuhner
Given the investment horizon of 90 days Okta Inc is expected to generate 1.57 times more return on investment than Hubersuhner. However, Okta is 1.57 times more volatile than Hubersuhner AG. It trades about -0.02 of its potential returns per unit of risk. Hubersuhner AG is currently generating about -0.2 per unit of risk. If you would invest 7,951 in Okta Inc on August 29, 2024 and sell it today you would lose (268.00) from holding Okta Inc or give up 3.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Okta Inc vs. Hubersuhner AG
Performance |
| Timeline |
| Okta Inc |
| Hubersuhner AG |
Okta and Hubersuhner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Hubersuhner
The main advantage of trading using opposite Okta and Hubersuhner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Hubersuhner 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 Hubersuhner will offset losses from the drop in Hubersuhner's long position.The idea behind Okta Inc and Hubersuhner AG 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.| Hubersuhner vs. Bucher Industries AG | Hubersuhner vs. Komax Holding AG | Hubersuhner vs. Comet Holding AG | Hubersuhner vs. Burckhardt Compression |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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