Correlation Between Verizon Communications and ONEOK
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By analyzing existing cross correlation between Verizon Communications and ONEOK INC NEW, you can compare the effects of market volatilities on Verizon Communications and ONEOK 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 Verizon Communications with a short position of ONEOK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Verizon Communications and ONEOK.
Diversification Opportunities for Verizon Communications and ONEOK
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Verizon and ONEOK is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Verizon Communications and ONEOK INC NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONEOK INC NEW and Verizon Communications 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 Verizon Communications are associated (or correlated) with ONEOK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONEOK INC NEW has no effect on the direction of Verizon Communications i.e., Verizon Communications and ONEOK go up and down completely randomly.
Pair Corralation between Verizon Communications and ONEOK
Allowing for the 90-day total investment horizon Verizon Communications is expected to generate 28.0 times less return on investment than ONEOK. But when comparing it to its historical volatility, Verizon Communications is 34.09 times less risky than ONEOK. It trades about 0.05 of its potential returns per unit of risk. ONEOK INC NEW is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,038 in ONEOK INC NEW on August 30, 2024 and sell it today you would lose (885.00) from holding ONEOK INC NEW or give up 9.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.1% |
| Values | Daily Returns |
Verizon Communications vs. ONEOK INC NEW
Performance |
| Timeline |
| Verizon Communications |
| ONEOK INC NEW |
Verizon Communications and ONEOK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Verizon Communications and ONEOK
The main advantage of trading using opposite Verizon Communications and ONEOK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Verizon Communications position performs unexpectedly, ONEOK 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 ONEOK will offset losses from the drop in ONEOK's long position.| Verizon Communications vs. Merck Company | Verizon Communications vs. Pharvaris BV | Verizon Communications vs. Brinker International | Verizon Communications vs. Alcoa Corp |
| ONEOK vs. Getty Realty | ONEOK vs. Olympic Steel | ONEOK vs. SunLink Health Systems | ONEOK vs. Bausch Lomb 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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