Correlation Between OppFi and Britvic PLC
Can any of the company-specific risk be diversified away by investing in both OppFi and Britvic PLC 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 Britvic PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and Britvic PLC ADR, you can compare the effects of market volatilities on OppFi and Britvic PLC 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 Britvic PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and Britvic PLC.
Diversification Opportunities for OppFi and Britvic PLC
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OppFi and Britvic is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and Britvic PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Britvic PLC ADR 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 Britvic PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Britvic PLC ADR has no effect on the direction of OppFi i.e., OppFi and Britvic PLC go up and down completely randomly.
Pair Corralation between OppFi and Britvic PLC
Given the investment horizon of 90 days OppFi Inc is expected to generate 2.86 times more return on investment than Britvic PLC. However, OppFi is 2.86 times more volatile than Britvic PLC ADR. It trades about 0.1 of its potential returns per unit of risk. Britvic PLC ADR is currently generating about 0.09 per unit of risk. If you would invest 219.00 in OppFi Inc on October 21, 2024 and sell it today you would earn a total of 883.00 from holding OppFi Inc or generate 403.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.53% |
| Values | Daily Returns |
OppFi Inc vs. Britvic PLC ADR
Performance |
| Timeline |
| OppFi Inc |
| Britvic PLC ADR |
OppFi and Britvic PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and Britvic PLC
The main advantage of trading using opposite OppFi and Britvic PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, Britvic PLC 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 Britvic PLC will offset losses from the drop in Britvic PLC's long position.The idea behind OppFi Inc and Britvic PLC ADR 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.| Britvic PLC vs. Embotelladora Andina SA | Britvic PLC vs. PT Astra International | Britvic PLC vs. Embotelladora Andina SA | Britvic PLC vs. Alkame Holdings |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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