Correlation Between Orca Energy and East Side

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

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

Diversification Opportunities for Orca Energy and East Side

0.0

Correlation Coefficient

Orca Energy  East Side

Pay attention - limited upside

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

Pair Corralation between Orca Energy and East Side

Assuming the 90 days trading horizon Orca Energy Group is expected to under-perform the East Side. But the stock apears to be less risky and, when comparing its historical volatility, Orca Energy Group is 11.37 times less risky than East Side. The stock trades about -0.05 of its potential returns per unit of risk. The East Side Games is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  52.00  in East Side Games on September 30, 2024 and sell it today you would earn a total of  4.00  from holding East Side Games or generate 7.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.73%
Values	Daily Returns

Orca Energy Group  vs.  East Side Games

Orca Energy Group

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Orca Energy Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Orca Energy is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

East Side Games

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days East Side Games has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Orca Energy and East Side

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

The idea behind Orca Energy Group and East Side Games 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 Global Correlations module to find global opportunities by holding instruments from different markets.