Correlation Between Outbrain and Onfolio Holdings

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

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

Diversification Opportunities for Outbrain and Onfolio Holdings

0.66

Correlation Coefficient

Outbrain  Onfolio Holdings

Poor diversification

The 3 months correlation between Outbrain and Onfolio is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Outbrain and Onfolio Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onfolio Holdings and Outbrain 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 Outbrain are associated (or correlated) with Onfolio Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onfolio Holdings has no effect on the direction of Outbrain i.e., Outbrain and Onfolio Holdings go up and down completely randomly.

Pair Corralation between Outbrain and Onfolio Holdings

Allowing for the 90-day total investment horizon Outbrain is expected to under-perform the Onfolio Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Outbrain is 1.19 times less risky than Onfolio Holdings. The stock trades about -0.25 of its potential returns per unit of risk. The Onfolio Holdings is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  139.00  in Onfolio Holdings on December 28, 2024 and sell it today you would lose (31.00) from holding Onfolio Holdings or give up 22.3% of portfolio value over 90 days.

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

Outbrain  vs.  Onfolio Holdings

Outbrain

Risk-Adjusted Performance

Very Weak

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

Onfolio Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Onfolio Holdings 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Outbrain and Onfolio Holdings

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

The idea behind Outbrain and Onfolio Holdings 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.