Correlation Between Oasis Hotel and Carbon Revolution

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

By analyzing existing cross correlation between Oasis Hotel Resort and Carbon Revolution Public, you can compare the effects of market volatilities on Oasis Hotel and Carbon Revolution 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 Oasis Hotel with a short position of Carbon Revolution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oasis Hotel and Carbon Revolution.

Diversification Opportunities for Oasis Hotel and Carbon Revolution

0.0

Correlation Coefficient

Oasis Hotel  Carbon Revolution

Pay attention - limited upside

The 3 months correlation between Oasis and Carbon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Oasis Hotel Resort and Carbon Revolution Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carbon Revolution Public and Oasis Hotel 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 Oasis Hotel Resort are associated (or correlated) with Carbon Revolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carbon Revolution Public has no effect on the direction of Oasis Hotel i.e., Oasis Hotel and Carbon Revolution go up and down completely randomly.

Pair Corralation between Oasis Hotel and Carbon Revolution

If you would invest  370.00  in Carbon Revolution Public on October 21, 2024 and sell it today you would earn a total of  135.00  from holding Carbon Revolution Public or generate 36.49% return on investment over 90 days.

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

Oasis Hotel Resort  vs.  Carbon Revolution Public

Oasis Hotel Resort

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Oasis Hotel Resort has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Oasis Hotel is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Carbon Revolution Public

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Carbon Revolution Public are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent technical and fundamental indicators, Carbon Revolution showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Oasis Hotel and Carbon Revolution

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

The idea behind Oasis Hotel Resort and Carbon Revolution Public 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.

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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.