Correlation Between Ocumetics Technology and Apple

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

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

Diversification Opportunities for Ocumetics Technology and Apple

-0.54

Correlation Coefficient

Ocumetics Technology  Apple

Excellent diversification

The 3 months correlation between Ocumetics and Apple is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Ocumetics Technology Corp and Apple Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc CDR and Ocumetics Technology 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 Ocumetics Technology Corp are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc CDR has no effect on the direction of Ocumetics Technology i.e., Ocumetics Technology and Apple go up and down completely randomly.

Pair Corralation between Ocumetics Technology and Apple

Assuming the 90 days horizon Ocumetics Technology is expected to generate 2.23 times less return on investment than Apple. In addition to that, Ocumetics Technology is 3.22 times more volatile than Apple Inc CDR. It trades about 0.01 of its total potential returns per unit of risk. Apple Inc CDR is currently generating about 0.08 per unit of volatility. If you would invest  2,158  in Apple Inc CDR on September 28, 2024 and sell it today you would earn a total of  1,582  from holding Apple Inc CDR or generate 73.31% return on investment over 90 days.

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

Ocumetics Technology Corp  vs.  Apple Inc CDR

Ocumetics Technology Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ocumetics Technology Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Ocumetics Technology is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Apple Inc CDR

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc CDR are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal technical and fundamental indicators, Apple may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Ocumetics Technology and Apple

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

The idea behind Ocumetics Technology Corp and Apple Inc CDR 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 Stocks Directory module to find actively traded stocks across global markets.