Correlation Between AKKO Invest and OPUS GLOBAL

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

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

Diversification Opportunities for AKKO Invest and OPUS GLOBAL

0.73

Correlation Coefficient

AKKO Invest  OPUS GLOBAL

Poor diversification

The 3 months correlation between AKKO and OPUS is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding AKKO Invest Nyrt and OPUS GLOBAL Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPUS GLOBAL Nyrt and AKKO Invest 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 AKKO Invest Nyrt are associated (or correlated) with OPUS GLOBAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPUS GLOBAL Nyrt has no effect on the direction of AKKO Invest i.e., AKKO Invest and OPUS GLOBAL go up and down completely randomly.

Pair Corralation between AKKO Invest and OPUS GLOBAL

Assuming the 90 days trading horizon AKKO Invest Nyrt is expected to generate 1.87 times more return on investment than OPUS GLOBAL. However, AKKO Invest is 1.87 times more volatile than OPUS GLOBAL Nyrt. It trades about 0.18 of its potential returns per unit of risk. OPUS GLOBAL Nyrt is currently generating about 0.18 per unit of risk. If you would invest  26,800  in AKKO Invest Nyrt on August 30, 2024 and sell it today you would earn a total of  6,900  from holding AKKO Invest Nyrt or generate 25.75% return on investment over 90 days.

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

AKKO Invest Nyrt  vs.  OPUS GLOBAL Nyrt

AKKO Invest Nyrt

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AKKO Invest Nyrt are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, AKKO Invest unveiled solid returns over the last few months and may actually be approaching a breakup point.

OPUS GLOBAL Nyrt

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in OPUS GLOBAL Nyrt are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, OPUS GLOBAL unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AKKO Invest and OPUS GLOBAL

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

The idea behind AKKO Invest Nyrt and OPUS GLOBAL Nyrt 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 Global Correlations module to find global opportunities by holding instruments from different markets.