Correlation Between Okta and ACADIA
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By analyzing existing cross correlation between Okta Inc and ACADIA HEALTHCARE INC, you can compare the effects of market volatilities on Okta and ACADIA 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 ACADIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okta and ACADIA.
Diversification Opportunities for Okta and ACADIA
Very good diversification
The 3 months correlation between Okta and ACADIA is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Okta Inc and ACADIA HEALTHCARE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACADIA HEALTHCARE INC 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 ACADIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACADIA HEALTHCARE INC has no effect on the direction of Okta i.e., Okta and ACADIA go up and down completely randomly.
Pair Corralation between Okta and ACADIA
Given the investment horizon of 90 days Okta Inc is expected to generate 2.9 times more return on investment than ACADIA. However, Okta is 2.9 times more volatile than ACADIA HEALTHCARE INC. It trades about 0.01 of its potential returns per unit of risk. ACADIA HEALTHCARE INC is currently generating about -0.11 per unit of risk. If you would invest 7,604 in Okta Inc on August 31, 2024 and sell it today you would earn a total of 38.00 from holding Okta Inc or generate 0.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Okta Inc vs. ACADIA HEALTHCARE INC
Performance |
| Timeline |
| Okta Inc |
| ACADIA HEALTHCARE INC |
Okta and ACADIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okta and ACADIA
The main advantage of trading using opposite Okta and ACADIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okta position performs unexpectedly, ACADIA 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 ACADIA will offset losses from the drop in ACADIA's long position.The idea behind Okta Inc and ACADIA HEALTHCARE INC 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.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.
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