Correlation Between OSB GROUP and LOANDEPOT INC
Can any of the company-specific risk be diversified away by investing in both OSB GROUP and LOANDEPOT INC 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 OSB GROUP and LOANDEPOT INC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OSB GROUP PLC and LOANDEPOT INC A, you can compare the effects of market volatilities on OSB GROUP and LOANDEPOT INC 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 OSB GROUP with a short position of LOANDEPOT INC. Check out your portfolio center. Please also check ongoing floating volatility patterns of OSB GROUP and LOANDEPOT INC.
Diversification Opportunities for OSB GROUP and LOANDEPOT INC
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between OSB and LOANDEPOT is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding OSB GROUP PLC and LOANDEPOT INC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOANDEPOT INC A and OSB GROUP 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 OSB GROUP PLC are associated (or correlated) with LOANDEPOT INC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOANDEPOT INC A has no effect on the direction of OSB GROUP i.e., OSB GROUP and LOANDEPOT INC go up and down completely randomly.
Pair Corralation between OSB GROUP and LOANDEPOT INC
Assuming the 90 days horizon OSB GROUP PLC is expected to generate 0.45 times more return on investment than LOANDEPOT INC. However, OSB GROUP PLC is 2.22 times less risky than LOANDEPOT INC. It trades about 0.03 of its potential returns per unit of risk. LOANDEPOT INC A is currently generating about -0.05 per unit of risk. If you would invest 452.00 in OSB GROUP PLC on September 24, 2024 and sell it today you would earn a total of 14.00 from holding OSB GROUP PLC or generate 3.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
OSB GROUP PLC vs. LOANDEPOT INC A
Performance |
Timeline |
OSB GROUP PLC |
LOANDEPOT INC A |
OSB GROUP and LOANDEPOT INC Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with OSB GROUP and LOANDEPOT INC
The main advantage of trading using opposite OSB GROUP and LOANDEPOT INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OSB GROUP position performs unexpectedly, LOANDEPOT INC 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 LOANDEPOT INC will offset losses from the drop in LOANDEPOT INC's long position.OSB GROUP vs. Mr Cooper Group | OSB GROUP vs. FIRST NATIONAL FIN | OSB GROUP vs. Deutsche Pfandbriefbank AG | OSB GROUP vs. ELLINGTON FINL INC |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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