Correlation Between OPKO HEALTH and Japan Post
Can any of the company-specific risk be diversified away by investing in both OPKO HEALTH and Japan Post 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 Japan Post into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OPKO HEALTH and Japan Post Insurance, you can compare the effects of market volatilities on OPKO HEALTH and Japan Post 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 Japan Post. Check out your portfolio center. Please also check ongoing floating volatility patterns of OPKO HEALTH and Japan Post.
Diversification Opportunities for OPKO HEALTH and Japan Post
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OPKO and Japan is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding OPKO HEALTH and Japan Post Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japan Post Insurance 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 Japan Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japan Post Insurance has no effect on the direction of OPKO HEALTH i.e., OPKO HEALTH and Japan Post go up and down completely randomly.
Pair Corralation between OPKO HEALTH and Japan Post
Assuming the 90 days trading horizon OPKO HEALTH is expected to generate 5.35 times less return on investment than Japan Post. But when comparing it to its historical volatility, OPKO HEALTH is 1.85 times less risky than Japan Post. It trades about 0.06 of its potential returns per unit of risk. Japan Post Insurance is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,800 in Japan Post Insurance on November 2, 2024 and sell it today you would earn a total of 70.00 from holding Japan Post Insurance or generate 3.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OPKO HEALTH vs. Japan Post Insurance
Performance |
| Timeline |
| OPKO HEALTH |
| Japan Post Insurance |
OPKO HEALTH and Japan Post Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OPKO HEALTH and Japan Post
The main advantage of trading using opposite OPKO HEALTH and Japan Post positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OPKO HEALTH position performs unexpectedly, Japan Post 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 Japan Post will offset losses from the drop in Japan Post's long position.| OPKO HEALTH vs. THRACE PLASTICS | OPKO HEALTH vs. CarsalesCom | OPKO HEALTH vs. Grupo Carso SAB | OPKO HEALTH vs. GEELY AUTOMOBILE |
| Japan Post vs. Live Nation Entertainment | Japan Post vs. Fuji Media Holdings | Japan Post vs. Seven West Media | Japan Post vs. Gaztransport Technigaz SA |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance |