Old Dominion Freight Stock Volatility
| ODFL Stock | USD 225.14 1.03 0.46% |
Old Dominion appears to be very steady, given 3 months investment horizon. Old Dominion Freight maintains Sharpe Ratio (i.e., Efficiency) of 0.11, which implies the firm had a 0.11% return per unit of risk over the last 3 months. We have found twenty-nine technical indicators for Old Dominion Freight, which you can use to evaluate the volatility of the company. Please evaluate Old Dominion's Risk Adjusted Performance of 0.0904, coefficient of variation of 912.91, and Semi Deviation of 2.11 to confirm if our risk estimates are consistent with your expectations. Key indicators related to Old Dominion's volatility include:
180 Days Market Risk | Chance Of Distress | 180 Days Economic Sensitivity |
Old Dominion Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Old daily returns, and it is calculated using variance and standard deviation. We also use Old's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Old Dominion volatility.
Old |
ESG Sustainability
While most ESG disclosures are voluntary, Old Dominion's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Old Dominion's managers and investors.Environmental | Governance | Social |
Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Old Dominion at lower prices. For example, an investor can purchase Old stock that has halved in price over a short period. This will lower their average cost per share, thereby improving the overall portfolio performance when market normalizes.
Moving together with Old Stock
| 0.79 | VLRS | Volaris | PairCorr |
| 0.94 | WERN | Werner Enterprises | PairCorr |
| 0.82 | AAL | American Airlines Aggressive Push | PairCorr |
| 0.84 | ALK | Alaska Air Group Fiscal Year End 23rd of January 2025 | PairCorr |
| 0.86 | DAL | Delta Air Lines Fiscal Year End 10th of January 2025 | PairCorr |
| 0.93 | KNX | Knight Transportation Fiscal Year End 22nd of January 2025 | PairCorr |
Moving against Old Stock
| 0.7 | CP | Canadian Pacific Railway | PairCorr |
| 0.62 | FLYX | flyExclusive, | PairCorr |
| 0.61 | MESA | Mesa Air Group Fiscal Year End 24th of January 2025 | PairCorr |
Old Dominion Market Sensitivity And Downside Risk
Old Dominion's beta coefficient measures the volatility of Old stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Old stock's returns against your selected market. In other words, Old Dominion's beta of 1.96 provides an investor with an approximation of how much risk Old Dominion stock can potentially add to one of your existing portfolios. Old Dominion Freight currently demonstrates below-average downside deviation. It has Information Ratio of 0.05 and Jensen Alpha of -0.01. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Old Dominion's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Old Dominion's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Old Dominion Freight Demand TrendCheck current 90 days Old Dominion correlation with market (Dow Jones Industrial)Old Beta |
Old standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 2.35 |
It is essential to understand the difference between upside risk (as represented by Old Dominion's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Old Dominion's daily returns or price. Since the actual investment returns on holding a position in old stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Old Dominion.
Old Dominion Freight Stock Volatility Analysis
Volatility refers to the frequency at which Old Dominion stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Old Dominion's price changes. Investors will then calculate the volatility of Old Dominion's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Old Dominion's volatility:
Historical Volatility
This type of stock volatility measures Old Dominion's fluctuations based on previous trends. It's commonly used to predict Old Dominion's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Old Dominion's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Old Dominion's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Old Dominion Freight Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Old Dominion Projected Return Density Against Market
Given the investment horizon of 90 days the stock has the beta coefficient of 1.9589 . This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Old Dominion will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Old Dominion or Ground Transportation sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Old Dominion's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Old stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Old Dominion Freight has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial. Predicted Return Density |
| Returns |
What Drives an Old Dominion Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Old Dominion Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Old Dominion is 906.06. The daily returns are distributed with a variance of 5.51 and standard deviation of 2.35. The mean deviation of Old Dominion Freight is currently at 1.58. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.76
α | Alpha over Dow Jones | -0.0081 | |
β | Beta against Dow Jones | 1.96 | |
σ | Overall volatility | 2.35 | |
Ir | Information ratio | 0.05 |
Old Dominion Stock Return Volatility
Old Dominion historical daily return volatility represents how much of Old Dominion stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company inherits 2.3465% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.7502% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Old Dominion Volatility
Volatility is a rate at which the price of Old Dominion or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Old Dominion may increase or decrease. In other words, similar to Old's beta indicator, it measures the risk of Old Dominion and helps estimate the fluctuations that may happen in a short period of time. So if prices of Old Dominion fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Selling And Marketing Expenses | 77.9 M | 81.8 M | |
| Market Cap | 44.4 B | 46.6 B |
Old Dominion's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Old Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Old Dominion's price varies over time.
3 ways to utilize Old Dominion's volatility to invest better
Higher Old Dominion's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Old Dominion Freight stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Old Dominion Freight stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Old Dominion Freight investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Old Dominion's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Old Dominion's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Old Dominion Investment Opportunity
Old Dominion Freight has a volatility of 2.35 and is 3.13 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of Old Dominion Freight is lower than 20 percent of all global equities and portfolios over the last 90 days. You can use Old Dominion Freight to enhance the returns of your portfolios. The stock experiences a normal upward fluctuation. Check odds of Old Dominion to be traded at $236.4 in 90 days.Poor diversification
The correlation between Old Dominion Freight and DJI is 0.65 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Old Dominion Freight and DJI in the same portfolio, assuming nothing else is changed.
Old Dominion Additional Risk Indicators
The analysis of Old Dominion's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Old Dominion's investment and either accepting that risk or mitigating it. Along with some common measures of Old Dominion stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0904 | |||
| Market Risk Adjusted Performance | 0.1335 | |||
| Mean Deviation | 1.55 | |||
| Semi Deviation | 2.11 | |||
| Downside Deviation | 2.3 | |||
| Coefficient Of Variation | 912.91 | |||
| Standard Deviation | 2.3 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Old Dominion Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Old Dominion as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Old Dominion's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Old Dominion's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Old Dominion Freight.
When determining whether Old Dominion Freight is a strong investment it is important to analyze Old Dominion's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Old Dominion's future performance. For an informed investment choice regarding Old Stock, refer to the following important reports: Check out Your Equity Center to better understand how to build diversified portfolios, which includes a position in Old Dominion Freight. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in census. You can also try the Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Is Cargo Ground Transportation space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Old Dominion. If investors know Old will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Old Dominion listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.07) | Dividend Share 0.98 | Earnings Share 5.71 | Revenue Per Share 27.363 | Quarterly Revenue Growth (0.03) |
The market value of Old Dominion Freight is measured differently than its book value, which is the value of Old that is recorded on the company's balance sheet. Investors also form their own opinion of Old Dominion's value that differs from its market value or its book value, called intrinsic value, which is Old Dominion's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Old Dominion's market value can be influenced by many factors that don't directly affect Old Dominion's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Old Dominion's value and its price as these two are different measures arrived at by different means. Investors typically determine if Old Dominion is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Old Dominion's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.