Correlation Between Open Text and EKAR
Can any of the company-specific risk be diversified away by investing in both Open Text and EKAR 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 EKAR 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 EKAR, you can compare the effects of market volatilities on Open Text and EKAR 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 EKAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Open Text and EKAR.
Diversification Opportunities for Open Text and EKAR
Very weak diversification
The 3 months correlation between Open and EKAR is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Open Text Corp and EKAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EKAR 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 EKAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EKAR has no effect on the direction of Open Text i.e., Open Text and EKAR go up and down completely randomly.
Pair Corralation between Open Text and EKAR
If you would invest (100.00) in EKAR on February 6, 2024 and sell it today you would earn a total of 100.00 from holding EKAR or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Open Text Corp vs. EKAR
Performance |
| Timeline |
| Open Text Corp |
| EKAR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Open Text and EKAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Open Text and EKAR
The main advantage of trading using opposite Open Text and EKAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Open Text position performs unexpectedly, EKAR 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 EKAR will offset losses from the drop in EKAR's long position.| Open Text vs. Topicus | Open Text vs. Brookfield | Open Text vs. Brookfield Asset Management | Open Text vs. Boyd Group Services |
| EKAR vs. Invesco Quality Municipal | EKAR vs. Franklin Disruptive Commerce | EKAR vs. Blackrock Muniyield Quality | EKAR vs. Blackrock Muniholdings Quality |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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