Correlation Between Open Lending and Figs

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

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

Diversification Opportunities for Open Lending and Figs

-0.3

Correlation Coefficient

Open Lending  Figs

Very good diversification

The 3 months correlation between Open and Figs is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Open Lending Corp and Figs Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Figs Inc and Open Lending 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 Open Lending Corp are associated (or correlated) with Figs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Figs Inc has no effect on the direction of Open Lending i.e., Open Lending and Figs go up and down completely randomly.

Pair Corralation between Open Lending and Figs

Given the investment horizon of 90 days Open Lending Corp is expected to generate 0.85 times more return on investment than Figs. However, Open Lending Corp is 1.18 times less risky than Figs. It trades about 0.01 of its potential returns per unit of risk. Figs Inc is currently generating about 0.01 per unit of risk. If you would invest  708.00  in Open Lending Corp on September 4, 2024 and sell it today you would lose (72.00) from holding Open Lending Corp or give up 10.17% of portfolio value over 90 days.

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

Open Lending Corp  vs.  Figs Inc

Open Lending Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Open Lending Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Open Lending displayed solid returns over the last few months and may actually be approaching a breakup point.

Figs Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Figs Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Figs is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Open Lending and Figs

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

The idea behind Open Lending Corp and Figs 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.