Correlation Between OppFi and Clarity Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both OppFi and Clarity Pharmaceuticals 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 Clarity Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and Clarity Pharmaceuticals, you can compare the effects of market volatilities on OppFi and Clarity Pharmaceuticals 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 Clarity Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and Clarity Pharmaceuticals.
Diversification Opportunities for OppFi and Clarity Pharmaceuticals
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OppFi and Clarity is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and Clarity Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clarity Pharmaceuticals 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 Clarity Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clarity Pharmaceuticals has no effect on the direction of OppFi i.e., OppFi and Clarity Pharmaceuticals go up and down completely randomly.
Pair Corralation between OppFi and Clarity Pharmaceuticals
Given the investment horizon of 90 days OppFi Inc is expected to generate 0.85 times more return on investment than Clarity Pharmaceuticals. However, OppFi Inc is 1.18 times less risky than Clarity Pharmaceuticals. It trades about 0.38 of its potential returns per unit of risk. Clarity Pharmaceuticals is currently generating about -0.11 per unit of risk. If you would invest 716.00 in OppFi Inc on October 23, 2024 and sell it today you would earn a total of 386.00 from holding OppFi Inc or generate 53.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OppFi Inc vs. Clarity Pharmaceuticals
Performance |
| Timeline |
| OppFi Inc |
| Clarity Pharmaceuticals |
OppFi and Clarity Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and Clarity Pharmaceuticals
The main advantage of trading using opposite OppFi and Clarity Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, Clarity Pharmaceuticals 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 Clarity Pharmaceuticals will offset losses from the drop in Clarity Pharmaceuticals' long position.The idea behind OppFi Inc and Clarity Pharmaceuticals 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.| Clarity Pharmaceuticals vs. Northstar Clean Technologies | Clarity Pharmaceuticals vs. China Clean Energy | Clarity Pharmaceuticals vs. Mattel Inc | Clarity Pharmaceuticals vs. BRP Inc |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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