Correlation Between EPlus and Oblong

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

By analyzing existing cross correlation between ePlus inc and Oblong Inc, you can compare the effects of market volatilities on EPlus and Oblong 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 EPlus with a short position of Oblong. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPlus and Oblong.

Diversification Opportunities for EPlus and Oblong

0.26

Correlation Coefficient

EPlus  Oblong

Modest diversification

The 3 months correlation between EPlus and Oblong is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding ePlus inc and Oblong Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oblong Inc and EPlus 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 ePlus inc are associated (or correlated) with Oblong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oblong Inc has no effect on the direction of EPlus i.e., EPlus and Oblong go up and down completely randomly.

Pair Corralation between EPlus and Oblong

Given the investment horizon of 90 days ePlus inc is expected to under-perform the Oblong. But the stock apears to be less risky and, when comparing its historical volatility, ePlus inc is 4.78 times less risky than Oblong. The stock trades about -0.04 of its potential returns per unit of risk. The Oblong Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  356.00  in Oblong Inc on August 31, 2024 and sell it today you would lose (5.00) from holding Oblong Inc or give up 1.4% of portfolio value over 90 days.

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

ePlus inc  vs.  Oblong Inc

ePlus inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ePlus inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Oblong Inc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Oblong Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating essential indicators, Oblong reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EPlus and Oblong

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

The idea behind ePlus inc and Oblong Inc 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.