Correlation Between Omnia Holdings and Brikor

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

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

Diversification Opportunities for Omnia Holdings and Brikor

0.55

Correlation Coefficient

Omnia Holdings  Brikor

Very weak diversification

The 3 months correlation between Omnia and Brikor is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Omnia Holdings Limited and Brikor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brikor and Omnia Holdings 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 Omnia Holdings Limited are associated (or correlated) with Brikor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brikor has no effect on the direction of Omnia Holdings i.e., Omnia Holdings and Brikor go up and down completely randomly.

Pair Corralation between Omnia Holdings and Brikor

Assuming the 90 days trading horizon Omnia Holdings is expected to generate 1.4 times less return on investment than Brikor. But when comparing it to its historical volatility, Omnia Holdings Limited is 3.56 times less risky than Brikor. It trades about 0.05 of its potential returns per unit of risk. Brikor is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,600  in Brikor on September 27, 2024 and sell it today you would lose (200.00) from holding Brikor or give up 12.5% of portfolio value over 90 days.

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

Omnia Holdings Limited  vs.  Brikor

Omnia Holdings

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Omnia Holdings Limited are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Omnia Holdings may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Brikor

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Brikor are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Brikor may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Omnia Holdings and Brikor

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

The idea behind Omnia Holdings Limited and Brikor 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.