Correlation Between I Tech and OptiCept Technologies
Can any of the company-specific risk be diversified away by investing in both I Tech and OptiCept Technologies 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 I Tech and OptiCept Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between I Tech and OptiCept Technologies AB, you can compare the effects of market volatilities on I Tech and OptiCept Technologies 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 I Tech with a short position of OptiCept Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Tech and OptiCept Technologies.
Diversification Opportunities for I Tech and OptiCept Technologies
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between ITECH and OptiCept is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding I Tech and OptiCept Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiCept Technologies and I Tech 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 I Tech are associated (or correlated) with OptiCept Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiCept Technologies has no effect on the direction of I Tech i.e., I Tech and OptiCept Technologies go up and down completely randomly.
Pair Corralation between I Tech and OptiCept Technologies
Assuming the 90 days trading horizon I Tech is expected to generate 1.12 times more return on investment than OptiCept Technologies. However, I Tech is 1.12 times more volatile than OptiCept Technologies AB. It trades about 0.43 of its potential returns per unit of risk. OptiCept Technologies AB is currently generating about -0.06 per unit of risk. If you would invest 4,780 in I Tech on September 27, 2024 and sell it today you would earn a total of 1,020 from holding I Tech or generate 21.34% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
I Tech vs. OptiCept Technologies AB
Performance |
Timeline |
I Tech |
OptiCept Technologies |
I Tech and OptiCept Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with I Tech and OptiCept Technologies
The main advantage of trading using opposite I Tech and OptiCept Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I Tech position performs unexpectedly, OptiCept Technologies 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 OptiCept Technologies will offset losses from the drop in OptiCept Technologies' long position.I Tech vs. BioInvent International AB | I Tech vs. Alligator Bioscience AB | I Tech vs. Moberg Pharma AB | I Tech vs. Oncopeptides AB |
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Check out your portfolio center.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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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