Correlation Between OptiNose and Intel

Can any of the company-specific risk be diversified away by investing in both OptiNose and Intel 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 OptiNose and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between OptiNose and Intel, you can compare the effects of market volatilities on OptiNose and Intel 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 OptiNose with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of OptiNose and Intel.

Diversification Opportunities for OptiNose and Intel

-0.04

Correlation Coefficient

OptiNose  Intel

Good diversification

The 3 months correlation between OptiNose and Intel is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding OptiNose and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and OptiNose 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 OptiNose are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of OptiNose i.e., OptiNose and Intel go up and down completely randomly.

Pair Corralation between OptiNose and Intel

Assuming the 90 days horizon OptiNose is expected to generate 40.42 times more return on investment than Intel. However, OptiNose is 40.42 times more volatile than Intel. It trades about 0.12 of its potential returns per unit of risk. Intel is currently generating about -0.02 per unit of risk. If you would invest  930.00  in OptiNose on October 9, 2024 and sell it today you would lose (354.00) from holding OptiNose or give up 38.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

OptiNose  vs.  Intel

OptiNose

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OptiNose are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, OptiNose reported solid returns over the last few months and may actually be approaching a breakup point.

Intel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Intel is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with OptiNose and Intel

The main advantage of trading using opposite OptiNose and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OptiNose position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.

The idea behind OptiNose and Intel 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.

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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.