Correlation Between Okta and Sitka Gold
Can any of the company-specific risk be diversified away by investing in both Okta and Sitka Gold 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 Sitka Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okta Inc and Sitka Gold Corp, you can compare the effects of market volatilities on Okta and Sitka Gold 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 Sitka Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and Sitka Gold.
Diversification Opportunities for Okta and Sitka Gold
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Okta and Sitka is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and Sitka Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sitka Gold Corp 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 Sitka Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sitka Gold Corp has no effect on the direction of Okta i.e., Okta and Sitka Gold go up and down completely randomly.
Pair Corralation between Okta and Sitka Gold
Given the investment horizon of 90 days Okta Inc is expected to generate 0.28 times more return on investment than Sitka Gold. However, Okta Inc is 3.62 times less risky than Sitka Gold. It trades about 0.13 of its potential returns per unit of risk. Sitka Gold Corp is currently generating about -0.07 per unit of risk. If you would invest 7,325 in Okta Inc on August 28, 2024 and sell it today you would earn a total of 358.00 from holding Okta Inc or generate 4.89% 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. Sitka Gold Corp
Performance |
| Timeline |
| Okta Inc |
| Sitka Gold Corp |
Okta and Sitka Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and Sitka Gold
The main advantage of trading using opposite Okta and Sitka Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, Sitka Gold 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 Sitka Gold will offset losses from the drop in Sitka Gold's long position.The idea behind Okta Inc and Sitka Gold Corp 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.| Sitka Gold vs. Aurion Resources | Sitka Gold vs. Minera Alamos | Sitka Gold vs. Rio2 Limited | Sitka Gold vs. Roscan Gold Corp |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |