Correlation Between Okta and Bank Polska
Can any of the company-specific risk be diversified away by investing in both Okta and Bank Polska 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 Bank Polska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Bank Polska Kasa, you can compare the effects of market volatilities on Okta and Bank Polska 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 Bank Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Bank Polska.
Diversification Opportunities for Okta and Bank Polska
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Okta and Bank is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Bank Polska Kasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Polska Kasa 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 Bank Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Polska Kasa has no effect on the direction of Okta i.e., Okta and Bank Polska go up and down completely randomly.
Pair Corralation between Okta and Bank Polska
Given the investment horizon of 90 days Okta is expected to generate 4.9 times less return on investment than Bank Polska. In addition to that, Okta is 1.44 times more volatile than Bank Polska Kasa. It trades about 0.01 of its total potential returns per unit of risk. Bank Polska Kasa is currently generating about 0.08 per unit of volatility. If you would invest 8,095 in Bank Polska Kasa on August 30, 2024 and sell it today you would earn a total of 5,810 from holding Bank Polska Kasa or generate 71.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Okta Inc vs. Bank Polska Kasa
Performance |
| Timeline |
| Okta Inc |
| Bank Polska Kasa |
Okta and Bank Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Bank Polska
The main advantage of trading using opposite Okta and Bank Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Bank Polska 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 Bank Polska will offset losses from the drop in Bank Polska's long position.The idea behind Okta Inc and Bank Polska Kasa 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.| Bank Polska vs. M Food SA | Bank Polska vs. Cloud Technologies SA | Bank Polska vs. Biztech Konsulting SA | Bank Polska vs. Quantum Software 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| 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 | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |