Correlation Between Open Text and Flushing Financial

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Open Text and Flushing Financial 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 Text and Flushing Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Open Text Corp and Flushing Financial, you can compare the effects of market volatilities on Open Text and Flushing Financial 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 Text with a short position of Flushing Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Open Text and Flushing Financial.

Diversification Opportunities for Open Text and Flushing Financial

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between Open and Flushing is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Open Text Corp and Flushing Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flushing Financial and Open Text 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 Text Corp are associated (or correlated) with Flushing Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flushing Financial has no effect on the direction of Open Text i.e., Open Text and Flushing Financial go up and down completely randomly.

Pair Corralation between Open Text and Flushing Financial

Given the investment horizon of 90 days Open Text Corp is expected to generate 0.68 times more return on investment than Flushing Financial. However, Open Text Corp is 1.48 times less risky than Flushing Financial. It trades about -0.06 of its potential returns per unit of risk. Flushing Financial is currently generating about -0.14 per unit of risk. If you would invest  4,175  in Open Text Corp on December 29, 2023 and sell it today you would lose (292.00) from holding Open Text Corp or give up 6.99% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Open Text Corp  vs.  Flushing Financial

 Performance 
       Timeline  
Open Text Corp 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Open Text Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.
Flushing Financial 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Flushing Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's forward indicators remain rather sound which may send shares a bit higher in April 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Open Text and Flushing Financial Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Open Text and Flushing Financial

The main advantage of trading using opposite Open Text and Flushing Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Open Text position performs unexpectedly, Flushing Financial 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 Flushing Financial will offset losses from the drop in Flushing Financial's long position.
The idea behind Open Text Corp and Flushing Financial 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

Other Complementary Tools

Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Bonds Directory
Find actively traded corporate debentures issued by US companies
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Stocks Directory
Find actively traded stocks across global markets
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Money Managers
Screen money managers from public funds and ETFs managed around the world
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk