Correlation Between ADEIA P and Oblong

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

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

Diversification Opportunities for ADEIA P and Oblong

-0.04

Correlation Coefficient

ADEIA P  Oblong

Good diversification

The 3 months correlation between ADEIA and Oblong is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding ADEIA P and Oblong Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oblong Inc and ADEIA P 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 ADEIA P 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 ADEIA P i.e., ADEIA P and Oblong go up and down completely randomly.

Pair Corralation between ADEIA P and Oblong

Given the investment horizon of 90 days ADEIA P is expected to generate 12.14 times less return on investment than Oblong. But when comparing it to its historical volatility, ADEIA P is 4.09 times less risky than Oblong. It trades about 0.02 of its potential returns per unit of risk. 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 September 3, 2024 and sell it today you would earn a total of  0.00  from holding Oblong Inc or generate 0.0% return on investment over 90 days.

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

ADEIA P  vs.  Oblong Inc

ADEIA P

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ADEIA P are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, ADEIA P is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the 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 weak essential indicators, Oblong reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ADEIA P and Oblong

The main advantage of trading using opposite ADEIA P and Oblong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADEIA P 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 ADEIA P 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.