Correlation Between Secure Energy and Optimi Health

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

By analyzing existing cross correlation between Secure Energy Services and Optimi Health Corp, you can compare the effects of market volatilities on Secure Energy and Optimi Health 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 Secure Energy with a short position of Optimi Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Secure Energy and Optimi Health.

Diversification Opportunities for Secure Energy and Optimi Health

-0.73

Correlation Coefficient

Secure Energy  Optimi Health

Pay attention - limited upside

The 3 months correlation between Secure and Optimi is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Secure Energy Services and Optimi Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optimi Health Corp and Secure Energy 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 Secure Energy Services are associated (or correlated) with Optimi Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optimi Health Corp has no effect on the direction of Secure Energy i.e., Secure Energy and Optimi Health go up and down completely randomly.

Pair Corralation between Secure Energy and Optimi Health

Assuming the 90 days horizon Secure Energy Services is expected to generate 0.29 times more return on investment than Optimi Health. However, Secure Energy Services is 3.41 times less risky than Optimi Health. It trades about 0.22 of its potential returns per unit of risk. Optimi Health Corp is currently generating about -0.02 per unit of risk. If you would invest  864.00  in Secure Energy Services on September 17, 2024 and sell it today you would earn a total of  287.00  from holding Secure Energy Services or generate 33.22% return on investment over 90 days.

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

Secure Energy Services  vs.  Optimi Health Corp

Secure Energy Services

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Secure Energy Services are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Secure Energy reported solid returns over the last few months and may actually be approaching a breakup point.

Optimi Health Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Optimi Health Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Secure Energy and Optimi Health

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

The idea behind Secure Energy Services and Optimi Health Corp 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.

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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.