Correlation Between Okta and Manning Napier
Can any of the company-specific risk be diversified away by investing in both Okta and Manning Napier 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 Manning Napier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Manning Napier Pro Blend, you can compare the effects of market volatilities on Okta and Manning Napier 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 Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Manning Napier.
Diversification Opportunities for Okta and Manning Napier
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Okta and Manning is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Manning Napier Pro Blend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier Pro 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 Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier Pro has no effect on the direction of Okta i.e., Okta and Manning Napier go up and down completely randomly.
Pair Corralation between Okta and Manning Napier
Given the investment horizon of 90 days Okta Inc is expected to generate 4.01 times more return on investment than Manning Napier. However, Okta is 4.01 times more volatile than Manning Napier Pro Blend. It trades about 0.16 of its potential returns per unit of risk. Manning Napier Pro Blend is currently generating about -0.02 per unit of risk. If you would invest 7,224 in Okta Inc on August 26, 2024 and sell it today you would earn a total of 433.00 from holding Okta Inc or generate 5.99% 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. Manning Napier Pro Blend
Performance |
| Timeline |
| Okta Inc |
| Manning Napier Pro |
Okta and Manning Napier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Manning Napier
The main advantage of trading using opposite Okta and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier's long position.The idea behind Okta Inc and Manning Napier Pro Blend 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.| Manning Napier vs. Pro Blend Moderate Term | Manning Napier vs. Pro Blend Maximum Term | Manning Napier vs. Pro Blend Servative Term | Manning Napier vs. Madison Mid Cap |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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