Correlation Between OppFi and ON24
Can any of the company-specific risk be diversified away by investing in both OppFi and ON24 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 ON24 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and ON24 Inc, you can compare the effects of market volatilities on OppFi and ON24 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 ON24. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and ON24.
Diversification Opportunities for OppFi and ON24
Poor diversification
The 3 months correlation between OppFi and ON24 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and ON24 Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ON24 Inc 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 ON24. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ON24 Inc has no effect on the direction of OppFi i.e., OppFi and ON24 go up and down completely randomly.
Pair Corralation between OppFi and ON24
Given the investment horizon of 90 days OppFi Inc is expected to generate 2.11 times more return on investment than ON24. However, OppFi is 2.11 times more volatile than ON24 Inc. It trades about 0.33 of its potential returns per unit of risk. ON24 Inc is currently generating about 0.08 per unit of risk. If you would invest 539.00 in OppFi Inc on August 27, 2024 and sell it today you would earn a total of 246.00 from holding OppFi Inc or generate 45.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OppFi Inc vs. ON24 Inc
Performance |
| Timeline |
| OppFi Inc |
| ON24 Inc |
OppFi and ON24 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and ON24
The main advantage of trading using opposite OppFi and ON24 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, ON24 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 ON24 will offset losses from the drop in ON24's long position.The idea behind OppFi Inc and ON24 Inc 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.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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |