Correlation Between Centrais Electricas and Oklo

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

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

Diversification Opportunities for Centrais Electricas and Oklo

-0.87

Correlation Coefficient

Centrais Electricas  Oklo

Pay attention - limited upside

The 3 months correlation between Centrais and Oklo is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Centrais Electricas Brasileira and Oklo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklo Inc and Centrais Electricas 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 Centrais Electricas Brasileiras 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 Centrais Electricas i.e., Centrais Electricas and Oklo go up and down completely randomly.

Pair Corralation between Centrais Electricas and Oklo

Considering the 90-day investment horizon Centrais Electricas Brasileiras is expected to under-perform the Oklo. But the stock apears to be less risky and, when comparing its historical volatility, Centrais Electricas Brasileiras is 5.63 times less risky than Oklo. The stock trades about -0.13 of its potential returns per unit of risk. The Oklo Inc is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  623.00  in Oklo Inc on September 12, 2024 and sell it today you would earn a total of  1,300  from holding Oklo Inc or generate 208.67% return on investment over 90 days.

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

Centrais Electricas Brasileira  vs.  Oklo Inc

Centrais Electricas

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Centrais Electricas Brasileiras has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail 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 fragile essential indicators, Oklo displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Centrais Electricas and Oklo

The main advantage of trading using opposite Centrais Electricas and Oklo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrais Electricas 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 Centrais Electricas Brasileiras 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.

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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.