Correlation Between Octopus Aim and Raymond James

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

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

Diversification Opportunities for Octopus Aim and Raymond James

-0.58

Correlation Coefficient

Octopus Aim  Raymond James

Excellent diversification

The 3 months correlation between Octopus and Raymond is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Octopus Aim Vct and Raymond James Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raymond James Financial and Octopus Aim 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 Octopus Aim Vct are associated (or correlated) with Raymond James. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raymond James Financial has no effect on the direction of Octopus Aim i.e., Octopus Aim and Raymond James go up and down completely randomly.

Pair Corralation between Octopus Aim and Raymond James

Assuming the 90 days trading horizon Octopus Aim Vct is expected to under-perform the Raymond James. But the stock apears to be less risky and, when comparing its historical volatility, Octopus Aim Vct is 2.8 times less risky than Raymond James. The stock trades about -0.06 of its potential returns per unit of risk. The Raymond James Financial is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  10,739  in Raymond James Financial on October 10, 2024 and sell it today you would earn a total of  5,188  from holding Raymond James Financial or generate 48.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	87.32%
Values	Daily Returns

Octopus Aim Vct  vs.  Raymond James Financial

Octopus Aim Vct

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Octopus Aim Vct has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Octopus Aim is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Raymond James Financial

Risk-Adjusted Performance

14 of 100

Good

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

Pair Trading with Octopus Aim and Raymond James

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

The idea behind Octopus Aim Vct and Raymond James Financial 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .