Correlation Between Ollies Bargain and Appfolio
Can any of the company-specific risk be diversified away by investing in both Ollies Bargain and Appfolio 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 Ollies Bargain and Appfolio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ollies Bargain Outlet and Appfolio, you can compare the effects of market volatilities on Ollies Bargain and Appfolio 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 Ollies Bargain with a short position of Appfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ollies Bargain and Appfolio.
Diversification Opportunities for Ollies Bargain and Appfolio
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ollies and Appfolio is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Ollies Bargain Outlet and Appfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Appfolio and Ollies Bargain 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 Ollies Bargain Outlet are associated (or correlated) with Appfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Appfolio has no effect on the direction of Ollies Bargain i.e., Ollies Bargain and Appfolio go up and down completely randomly.
Pair Corralation between Ollies Bargain and Appfolio
Given the investment horizon of 90 days Ollies Bargain is expected to generate 1.08 times less return on investment than Appfolio. But when comparing it to its historical volatility, Ollies Bargain Outlet is 1.11 times less risky than Appfolio. It trades about 0.06 of its potential returns per unit of risk. Appfolio is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 12,885 in Appfolio on January 16, 2025 and sell it today you would earn a total of 9,301 from holding Appfolio or generate 72.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ollies Bargain Outlet vs. Appfolio
Performance |
| Timeline |
| Ollies Bargain Outlet |
| Appfolio |
Ollies Bargain and Appfolio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ollies Bargain and Appfolio
The main advantage of trading using opposite Ollies Bargain and Appfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ollies Bargain position performs unexpectedly, Appfolio 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 Appfolio will offset losses from the drop in Appfolio's long position.| Ollies Bargain vs. Dollar Tree | Ollies Bargain vs. BJs Wholesale Club | Ollies Bargain vs. Dollar General | Ollies Bargain vs. Costco Wholesale 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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