Correlation Between Opko Health and Insuline Medical
Can any of the company-specific risk be diversified away by investing in both Opko Health and Insuline Medical 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 Opko Health and Insuline Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Opko Health and Insuline Medical, you can compare the effects of market volatilities on Opko Health and Insuline Medical 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 Opko Health with a short position of Insuline Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Opko Health and Insuline Medical.
Diversification Opportunities for Opko Health and Insuline Medical
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Opko and Insuline is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Opko Health and Insuline Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insuline Medical and Opko Health 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 Opko Health are associated (or correlated) with Insuline Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insuline Medical has no effect on the direction of Opko Health i.e., Opko Health and Insuline Medical go up and down completely randomly.
Pair Corralation between Opko Health and Insuline Medical
Assuming the 90 days trading horizon Opko Health is expected to generate 0.72 times more return on investment than Insuline Medical. However, Opko Health is 1.4 times less risky than Insuline Medical. It trades about -0.14 of its potential returns per unit of risk. Insuline Medical is currently generating about -0.2 per unit of risk. If you would invest 55,370 in Opko Health on October 25, 2024 and sell it today you would lose (2,570) from holding Opko Health or give up 4.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Opko Health vs. Insuline Medical
Performance |
| Timeline |
| Opko Health |
| Insuline Medical |
Opko Health and Insuline Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Opko Health and Insuline Medical
The main advantage of trading using opposite Opko Health and Insuline Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Opko Health position performs unexpectedly, Insuline Medical 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 Insuline Medical will offset losses from the drop in Insuline Medical's long position.| Opko Health vs. Teva Pharmaceutical Industries | Opko Health vs. Tower Semiconductor | Opko Health vs. Nice | Opko Health vs. Kamada |
| Insuline Medical vs. Intercure | Insuline Medical vs. Sofwave Medical | Insuline Medical vs. Epitomee Medical | Insuline Medical vs. Brainsway |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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