Correlation Between OppFi and Cheniere Energy
Can any of the company-specific risk be diversified away by investing in both OppFi and Cheniere Energy 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 Cheniere Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and Cheniere Energy, you can compare the effects of market volatilities on OppFi and Cheniere Energy 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 Cheniere Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and Cheniere Energy.
Diversification Opportunities for OppFi and Cheniere Energy
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between OppFi and Cheniere is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and Cheniere Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheniere Energy 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 Cheniere Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheniere Energy has no effect on the direction of OppFi i.e., OppFi and Cheniere Energy go up and down completely randomly.
Pair Corralation between OppFi and Cheniere Energy
Given the investment horizon of 90 days OppFi Inc is expected to generate 4.47 times more return on investment than Cheniere Energy. However, OppFi is 4.47 times more volatile than Cheniere Energy. It trades about 0.38 of its potential returns per unit of risk. Cheniere Energy is currently generating about 0.68 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 Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
OppFi Inc vs. Cheniere Energy
Performance |
| Timeline |
| OppFi Inc |
| Cheniere Energy |
OppFi and Cheniere Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and Cheniere Energy
The main advantage of trading using opposite OppFi and Cheniere Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, Cheniere Energy 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 Cheniere Energy will offset losses from the drop in Cheniere Energy's long position.The idea behind OppFi Inc and Cheniere Energy 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.| Cheniere Energy vs. Western Midstream Partners | Cheniere Energy vs. Williams Companies | Cheniere Energy vs. Enterprise Products Partners | Cheniere Energy vs. ONEOK 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |