Correlation Between Global Blue and Okta

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

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

Diversification Opportunities for Global Blue and Okta

0.19

Correlation Coefficient

Global Blue  Okta

Average diversification

The 3 months correlation between Global and Okta is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Global Blue Group and Okta Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okta Inc and Global Blue 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 Global Blue Group are associated (or correlated) with Okta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okta Inc has no effect on the direction of Global Blue i.e., Global Blue and Okta go up and down completely randomly.

Pair Corralation between Global Blue and Okta

Allowing for the 90-day total investment horizon Global Blue is expected to generate 3.0 times less return on investment than Okta. But when comparing it to its historical volatility, Global Blue Group is 1.31 times less risky than Okta. It trades about 0.06 of its potential returns per unit of risk. Okta Inc is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  8,164  in Okta Inc on December 27, 2024 and sell it today you would earn a total of  2,956  from holding Okta Inc or generate 36.21% return on investment over 90 days.

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

Global Blue Group  vs.  Okta Inc

Global Blue Group

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Blue Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental drivers, Global Blue may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Okta Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Okta Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, Okta sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Global Blue and Okta

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

The idea behind Global Blue Group and Okta Inc 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..