Correlation Between Okta and Puyi
Can any of the company-specific risk be diversified away by investing in both Okta and Puyi 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 Puyi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Puyi Inc ADR, you can compare the effects of market volatilities on Okta and Puyi 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 Puyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Puyi.
Diversification Opportunities for Okta and Puyi
Average diversification
The 3 months correlation between Okta and Puyi is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Puyi Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puyi Inc ADR 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 Puyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puyi Inc ADR has no effect on the direction of Okta i.e., Okta and Puyi go up and down completely randomly.
Pair Corralation between Okta and Puyi
If you would invest 7,240 in Okta Inc on August 31, 2024 and sell it today you would earn a total of 402.00 from holding Okta Inc or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Okta Inc vs. Puyi Inc ADR
Performance |
| Timeline |
| Okta Inc |
| Puyi Inc ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Okta and Puyi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Puyi
The main advantage of trading using opposite Okta and Puyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Puyi 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 Puyi will offset losses from the drop in Puyi's long position.The idea behind Okta Inc and Puyi Inc ADR 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.| Puyi vs. Eaton Vance National | Puyi vs. Invesco High Income | Puyi vs. Blackrock Muniholdings Ny | Puyi vs. Nuveen California Select |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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