Correlation Between Optima Health and Intuitive Investments
Can any of the company-specific risk be diversified away by investing in both Optima Health and Intuitive Investments 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 Optima Health and Intuitive Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Optima Health plc and Intuitive Investments Group, you can compare the effects of market volatilities on Optima Health and Intuitive Investments 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 Optima Health with a short position of Intuitive Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Optima Health and Intuitive Investments.
Diversification Opportunities for Optima Health and Intuitive Investments
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Optima and Intuitive is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Optima Health plc and Intuitive Investments Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Investments and Optima 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 Optima Health plc are associated (or correlated) with Intuitive Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuitive Investments has no effect on the direction of Optima Health i.e., Optima Health and Intuitive Investments go up and down completely randomly.
Pair Corralation between Optima Health and Intuitive Investments
Assuming the 90 days trading horizon Optima Health plc is expected to generate 1.27 times more return on investment than Intuitive Investments. However, Optima Health is 1.27 times more volatile than Intuitive Investments Group. It trades about -0.01 of its potential returns per unit of risk. Intuitive Investments Group is currently generating about -0.36 per unit of risk. If you would invest 15,850 in Optima Health plc on August 25, 2024 and sell it today you would lose (50.00) from holding Optima Health plc or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Optima Health plc vs. Intuitive Investments Group
Performance |
| Timeline |
| Optima Health plc |
| Intuitive Investments |
Optima Health and Intuitive Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Optima Health and Intuitive Investments
The main advantage of trading using opposite Optima Health and Intuitive Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Optima Health position performs unexpectedly, Intuitive Investments 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 Intuitive Investments will offset losses from the drop in Intuitive Investments' long position.| Optima Health vs. Toyota Motor Corp | Optima Health vs. SoftBank Group Corp | Optima Health vs. OTP Bank Nyrt | Optima Health vs. Yum Brands |
| Intuitive Investments vs. Cardinal Health | Intuitive Investments vs. Beowulf Mining | Intuitive Investments vs. Wheaton Precious Metals | Intuitive Investments vs. Optima Health plc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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