Correlation Between Opko Health and PIMCO 1
Can any of the company-specific risk be diversified away by investing in both Opko Health and PIMCO 1 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 Opko Health and PIMCO 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Opko Health and PIMCO 1 5 Year, you can compare the effects of market volatilities on Opko Health and PIMCO 1 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 Opko Health with a short position of PIMCO 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Opko Health and PIMCO 1.
Diversification Opportunities for Opko Health and PIMCO 1
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Opko and PIMCO is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Opko Health and PIMCO 1 5 Year in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PIMCO 1 5 and Opko Health 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 Opko Health are associated (or correlated) with PIMCO 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PIMCO 1 5 has no effect on the direction of Opko Health i.e., Opko Health and PIMCO 1 go up and down completely randomly.
Pair Corralation between Opko Health and PIMCO 1
Considering the 90-day investment horizon Opko Health is expected to generate 29.64 times more return on investment than PIMCO 1. However, Opko Health is 29.64 times more volatile than PIMCO 1 5 Year. It trades about 0.24 of its potential returns per unit of risk. PIMCO 1 5 Year is currently generating about -0.03 per unit of risk. If you would invest 101.00 in Opko Health on January 26, 2024 and sell it today you would earn a total of 22.00 from holding Opko Health or generate 21.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Opko Health vs. PIMCO 1 5 Year
Performance |
| Timeline |
| Opko Health |
| PIMCO 1 5 |
Opko Health and PIMCO 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Opko Health and PIMCO 1
The main advantage of trading using opposite Opko Health and PIMCO 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Opko Health position performs unexpectedly, PIMCO 1 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 PIMCO 1 will offset losses from the drop in PIMCO 1's long position.| Opko Health vs. Olink Holding AB | Opko Health vs. Sotera Health Co | Opko Health vs. RadNet Inc | Opko Health vs. BiodesixInc |
| PIMCO 1 vs. iShares iBoxx Investment | PIMCO 1 vs. iShares 1 3 Year | PIMCO 1 vs. iShares 7 10 Year | PIMCO 1 vs. iShares Core Aggregate |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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