Correlation Between Olympia Financial and Dayforce

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

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

Diversification Opportunities for Olympia Financial and Dayforce

0.53

Correlation Coefficient

Olympia Financial  Dayforce

Very weak diversification

The 3 months correlation between Olympia and Dayforce is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Olympia Financial Group and Dayforce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dayforce and Olympia Financial 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 Olympia Financial Group are associated (or correlated) with Dayforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dayforce has no effect on the direction of Olympia Financial i.e., Olympia Financial and Dayforce go up and down completely randomly.

Pair Corralation between Olympia Financial and Dayforce

Assuming the 90 days trading horizon Olympia Financial Group is expected to generate 0.95 times more return on investment than Dayforce. However, Olympia Financial Group is 1.05 times less risky than Dayforce. It trades about 0.07 of its potential returns per unit of risk. Dayforce is currently generating about 0.02 per unit of risk. If you would invest  5,998  in Olympia Financial Group on October 4, 2024 and sell it today you would earn a total of  4,847  from holding Olympia Financial Group or generate 80.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

Olympia Financial Group  vs.  Dayforce

Olympia Financial

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Olympia Financial Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Olympia Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Dayforce

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dayforce are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Dayforce displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Olympia Financial and Dayforce

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

The idea behind Olympia Financial Group and Dayforce 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.