Correlation Between Worthington Steel and Oklo

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

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

Diversification Opportunities for Worthington Steel and Oklo

0.04

Correlation Coefficient

Worthington Steel  Oklo

Significant diversification

The 3 months correlation between Worthington and Oklo is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Worthington Steel and Oklo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklo Inc and Worthington Steel 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 Worthington Steel are associated (or correlated) with Oklo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklo Inc has no effect on the direction of Worthington Steel i.e., Worthington Steel and Oklo go up and down completely randomly.

Pair Corralation between Worthington Steel and Oklo

Allowing for the 90-day total investment horizon Worthington Steel is expected to under-perform the Oklo. But the stock apears to be less risky and, when comparing its historical volatility, Worthington Steel is 2.02 times less risky than Oklo. The stock trades about -0.44 of its potential returns per unit of risk. The Oklo Inc is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  1,842  in Oklo Inc on October 11, 2024 and sell it today you would earn a total of  770.00  from holding Oklo Inc or generate 41.8% return on investment over 90 days.

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

Worthington Steel  vs.  Oklo Inc

Worthington Steel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Worthington Steel 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.

Oklo Inc

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Oklo Inc are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating essential indicators, Oklo displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Worthington Steel and Oklo

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

The idea behind Worthington Steel and Oklo 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.

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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.