Correlation Between Ocumetics Technology and CI Financial

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

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

Diversification Opportunities for Ocumetics Technology and CI Financial

-0.1

Correlation Coefficient

Ocumetics Technology  CI Financial

Good diversification

The 3 months correlation between Ocumetics and CIX is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ocumetics Technology Corp and CI Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Financial Corp and Ocumetics Technology 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 Ocumetics Technology Corp are associated (or correlated) with CI Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Financial Corp has no effect on the direction of Ocumetics Technology i.e., Ocumetics Technology and CI Financial go up and down completely randomly.

Pair Corralation between Ocumetics Technology and CI Financial

Assuming the 90 days horizon Ocumetics Technology Corp is expected to generate 30.31 times more return on investment than CI Financial. However, Ocumetics Technology is 30.31 times more volatile than CI Financial Corp. It trades about 0.02 of its potential returns per unit of risk. CI Financial Corp is currently generating about 0.13 per unit of risk. If you would invest  29.00  in Ocumetics Technology Corp on December 28, 2024 and sell it today you would lose (1.00) from holding Ocumetics Technology Corp or give up 3.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Ocumetics Technology Corp  vs.  CI Financial Corp

Ocumetics Technology Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ocumetics Technology Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Ocumetics Technology may actually be approaching a critical reversion point that can send shares even higher in April 2025.

CI Financial Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CI Financial Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, CI Financial is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Ocumetics Technology and CI Financial

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

The idea behind Ocumetics Technology Corp and CI Financial Corp 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.