Correlation Between Forian and OPTIMIZERx Corp

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

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

Diversification Opportunities for Forian and OPTIMIZERx Corp

0.75

Correlation Coefficient

Forian  OPTIMIZERx Corp

Poor diversification

The 3 months correlation between Forian and OPTIMIZERx is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Forian Inc and OPTIMIZERx Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPTIMIZERx Corp and Forian 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 Forian Inc are associated (or correlated) with OPTIMIZERx Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPTIMIZERx Corp has no effect on the direction of Forian i.e., Forian and OPTIMIZERx Corp go up and down completely randomly.

Pair Corralation between Forian and OPTIMIZERx Corp

Given the investment horizon of 90 days Forian Inc is expected to generate 0.28 times more return on investment than OPTIMIZERx Corp. However, Forian Inc is 3.62 times less risky than OPTIMIZERx Corp. It trades about -0.13 of its potential returns per unit of risk. OPTIMIZERx Corp is currently generating about -0.05 per unit of risk. If you would invest  241.00  in Forian Inc on September 3, 2024 and sell it today you would lose (35.00) from holding Forian Inc or give up 14.52% of portfolio value over 90 days.

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

Forian Inc  vs.  OPTIMIZERx Corp

Forian Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Forian Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

OPTIMIZERx Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OPTIMIZERx Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Forian and OPTIMIZERx Corp

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

The idea behind Forian Inc and OPTIMIZERx Corp 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.