Correlation Between OptiNose and Identiv

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

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

Diversification Opportunities for OptiNose and Identiv

-0.38

Correlation Coefficient

OptiNose  Identiv

Very good diversification

The 3 months correlation between OptiNose and Identiv is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding OptiNose and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of OptiNose i.e., OptiNose and Identiv go up and down completely randomly.

Pair Corralation between OptiNose and Identiv

Assuming the 90 days horizon OptiNose is expected to generate 39.32 times more return on investment than Identiv. However, OptiNose is 39.32 times more volatile than Identiv. It trades about 0.12 of its potential returns per unit of risk. Identiv is currently generating about 0.04 per unit of risk. If you would invest  1,080  in OptiNose on October 24, 2024 and sell it today you would lose (473.00) from holding OptiNose or give up 43.8% of portfolio value over 90 days.

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

OptiNose  vs.  Identiv

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 uncertain basic indicators, OptiNose reported solid returns over the last few months and may actually be approaching a breakup point.

Identiv

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Identiv are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Identiv may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with OptiNose and Identiv

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

The idea behind OptiNose and Identiv 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.