Correlation Between SOS and OneSpan
Can any of the company-specific risk be diversified away by investing in both SOS and OneSpan 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 SOS and OneSpan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOS Limited and OneSpan, you can compare the effects of market volatilities on SOS and OneSpan 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 SOS with a short position of OneSpan. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOS and OneSpan.
Diversification Opportunities for SOS and OneSpan
Very good diversification
The 3 months correlation between SOS and OneSpan is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding SOS Limited and OneSpan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneSpan and SOS 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 SOS Limited are associated (or correlated) with OneSpan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneSpan has no effect on the direction of SOS i.e., SOS and OneSpan go up and down completely randomly.
Pair Corralation between SOS and OneSpan
Considering the 90-day investment horizon SOS Limited is expected to under-perform the OneSpan. In addition to that, SOS is 2.48 times more volatile than OneSpan. It trades about -0.01 of its total potential returns per unit of risk. OneSpan is currently generating about 0.04 per unit of volatility. If you would invest 1,237 in OneSpan on August 30, 2024 and sell it today you would earn a total of 587.00 from holding OneSpan or generate 47.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOS Limited vs. OneSpan
Performance |
| Timeline |
| SOS Limited |
| OneSpan |
SOS and OneSpan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOS and OneSpan
The main advantage of trading using opposite SOS and OneSpan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOS position performs unexpectedly, OneSpan 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 OneSpan will offset losses from the drop in OneSpan's long position.The idea behind SOS Limited and OneSpan 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.| OneSpan vs. Lesaka Technologies | OneSpan vs. Priority Technology Holdings | OneSpan vs. CSG Systems International | OneSpan vs. Sangoma Technologies Corp |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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