Correlation Between OppFi and Beiersdorf Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both OppFi and Beiersdorf Aktiengesellscha 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 OppFi and Beiersdorf Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and Beiersdorf Aktiengesellschaft, you can compare the effects of market volatilities on OppFi and Beiersdorf Aktiengesellscha 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 OppFi with a short position of Beiersdorf Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and Beiersdorf Aktiengesellscha.
Diversification Opportunities for OppFi and Beiersdorf Aktiengesellscha
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OppFi and Beiersdorf is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and Beiersdorf Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beiersdorf Aktiengesellscha and OppFi 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 OppFi Inc are associated (or correlated) with Beiersdorf Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beiersdorf Aktiengesellscha has no effect on the direction of OppFi i.e., OppFi and Beiersdorf Aktiengesellscha go up and down completely randomly.
Pair Corralation between OppFi and Beiersdorf Aktiengesellscha
Given the investment horizon of 90 days OppFi Inc is expected to generate 3.55 times more return on investment than Beiersdorf Aktiengesellscha. However, OppFi is 3.55 times more volatile than Beiersdorf Aktiengesellschaft. It trades about 0.49 of its potential returns per unit of risk. Beiersdorf Aktiengesellschaft is currently generating about -0.32 per unit of risk. If you would invest 485.00 in OppFi Inc on September 4, 2024 and sell it today you would earn a total of 331.00 from holding OppFi Inc or generate 68.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OppFi Inc vs. Beiersdorf Aktiengesellschaft
Performance |
| Timeline |
| OppFi Inc |
| Beiersdorf Aktiengesellscha |
OppFi and Beiersdorf Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and Beiersdorf Aktiengesellscha
The main advantage of trading using opposite OppFi and Beiersdorf Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, Beiersdorf Aktiengesellscha 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 Beiersdorf Aktiengesellscha will offset losses from the drop in Beiersdorf Aktiengesellscha's long position.The idea behind OppFi Inc and Beiersdorf Aktiengesellschaft 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.| Beiersdorf Aktiengesellscha vs. Henkel Ag A | Beiersdorf Aktiengesellscha vs. Essity AB | Beiersdorf Aktiengesellscha vs. Hengan International Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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