Correlation Between Olink Holding and Inotiv
Can any of the company-specific risk be diversified away by investing in both Olink Holding and Inotiv 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 Olink Holding and Inotiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Olink Holding AB and Inotiv Inc, you can compare the effects of market volatilities on Olink Holding and Inotiv 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 Olink Holding with a short position of Inotiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Olink Holding and Inotiv.
Diversification Opportunities for Olink Holding and Inotiv
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Olink and Inotiv is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Olink Holding AB and Inotiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inotiv Inc and Olink Holding 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 Olink Holding AB are associated (or correlated) with Inotiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inotiv Inc has no effect on the direction of Olink Holding i.e., Olink Holding and Inotiv go up and down completely randomly.
Pair Corralation between Olink Holding and Inotiv
Considering the 90-day investment horizon Olink Holding is expected to generate 1.47 times less return on investment than Inotiv. But when comparing it to its historical volatility, Olink Holding AB is 1.69 times less risky than Inotiv. It trades about 0.03 of its potential returns per unit of risk. Inotiv Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 568.00 in Inotiv Inc on August 30, 2024 and sell it today you would lose (214.00) from holding Inotiv Inc or give up 37.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 80.2% |
| Values | Daily Returns |
Olink Holding AB vs. Inotiv Inc
Performance |
| Timeline |
| Olink Holding AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Inotiv Inc |
Olink Holding and Inotiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Olink Holding and Inotiv
The main advantage of trading using opposite Olink Holding and Inotiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Olink Holding position performs unexpectedly, Inotiv 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 Inotiv will offset losses from the drop in Inotiv's long position.| Olink Holding vs. Fonar | Olink Holding vs. Burning Rock Biotech | Olink Holding vs. Sera Prognostics | Olink Holding vs. Psychemedics |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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