Correlation Between Vista Outdoor and Optimi Health
Can any of the company-specific risk be diversified away by investing in both Vista Outdoor and Optimi Health 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 Vista Outdoor and Optimi Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vista Outdoor and Optimi Health Corp, you can compare the effects of market volatilities on Vista Outdoor and Optimi Health 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 Vista Outdoor with a short position of Optimi Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vista Outdoor and Optimi Health.
Diversification Opportunities for Vista Outdoor and Optimi Health
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Vista and Optimi is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Vista Outdoor and Optimi Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optimi Health Corp and Vista Outdoor 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 Vista Outdoor are associated (or correlated) with Optimi Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optimi Health Corp has no effect on the direction of Vista Outdoor i.e., Vista Outdoor and Optimi Health go up and down completely randomly.
Pair Corralation between Vista Outdoor and Optimi Health
Given the investment horizon of 90 days Vista Outdoor is expected to generate 0.29 times more return on investment than Optimi Health. However, Vista Outdoor is 3.5 times less risky than Optimi Health. It trades about 0.12 of its potential returns per unit of risk. Optimi Health Corp is currently generating about -0.09 per unit of risk. If you would invest 3,453 in Vista Outdoor on September 1, 2024 and sell it today you would earn a total of 1,010 from holding Vista Outdoor or generate 29.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.43% |
| Values | Daily Returns |
Vista Outdoor vs. Optimi Health Corp
Performance |
| Timeline |
| Vista Outdoor |
| Optimi Health Corp |
Vista Outdoor and Optimi Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vista Outdoor and Optimi Health
The main advantage of trading using opposite Vista Outdoor and Optimi Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vista Outdoor position performs unexpectedly, Optimi Health 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 Optimi Health will offset losses from the drop in Optimi Health's long position.| Vista Outdoor vs. Clarus Corp | Vista Outdoor vs. Johnson Outdoors | Vista Outdoor vs. Escalade Incorporated | Vista Outdoor vs. JAKKS Pacific |
| Optimi Health vs. Cybin Inc | Optimi Health vs. TAAT Global Alternatives | Optimi Health vs. Spey Resources 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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