Ocean Story

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OPTT -- USA Stock  

USD 2.08  0.07  3.26%

It appears Ocean Power may not recover as fast as we have hopped for as its price went down 34.56% today. The company's current daily volatility is 13.56 percent, with a beta of 1.3 and an alpha of 2.15 over DOW. While many traders are getting carried away by overanalyzing market volatility, it is reasonable to review Ocean Power based on how it reacts to the newest economic swings. We will analyze why Ocean Power investors may still consider a stake in the business.
Published over two weeks ago
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Should you trade Ocean Power after the newest volatility gain?
This firm conducts business under Industrials sector and is part of Electrical Equipment & Parts industry. We provide trade recommendations to complement the recent expert consensus on Ocean Power Technolo. Our dynamic recommendation engine exercises a multidimensional algorithm to analyze the firm's potential to grow using all technical and fundamental data available at the time.
Investing in Ocean Power, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Ocean Power along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.

How important is Ocean Power's Liquidity

Ocean Power financial leverage refers to using borrowed capital as a funding source to finance Ocean Power ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Ocean Power financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Ocean Power's total debt and its cash.

How Ocean utilizes its cash?

To perform a cash flow analysis of Ocean Power, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Ocean Power is receiving and how much cash it distributes out in a given period. The Ocean Power cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Ocean Power Net Cash Flow from Operations is comparatively stable at the moment as compared to the past year. Ocean Power reported Net Cash Flow from Operations of (10.58 Million) in 2019

Ocean Power Correlation with Peers

Investors in Ocean can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Ocean Power. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Ocean Power and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Ocean is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage. Please check volatility of Ocean for more details

Breaking it down a bit more

Ocean Power is abnormally volatile given 1 month investment horizon. Ocean Power Technolo maintains Sharpe Ratio (i.e. Efficiency) of 0.2, which implies the firm had 0.2% of return per unit of risk over the last month. Our standpoint towards forecasting the volatility of a stock is to use Ocean Power Technolo market data together with company specific technical indicators. We were able to interpolate twenty-one different technical indicators, which can help you to evaluate if expected returns of 2.76% are justified by taking the suggested risk. Use Ocean Power Semi Deviation of 7.12, coefficient of variation of 566.77, and Risk Adjusted Performance of 0.1863 to evaluate company specific risk that cannot be diversified away.
Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

Is Ocean Power getting woozy?

Variance is down to 174.63. It may call for a possible volatility drop. As of the 11th of October 2020, Ocean Power holds the Risk Adjusted Performance of 0.1863, coefficient of variation of 566.77, and Semi Deviation of 7.12. Compared to fundamental indicators, the technical analysis model allows you to check existing technical drivers of Ocean Power, as well as the relationship between them. Put it differently, you can use this information to find out if the company will indeed mirror its model of past market data, or the prices will eventually revert. We were able to interpolate nineteen technical drivers for Ocean Power Technolo, which can be compared to its competitors. Please check Ocean Power Technolo semi deviation, jensen alpha, as well as the relationship between the Jensen Alpha and semi variance to decide if Ocean Power Technolo is priced some-what accurately, providing market reflects its current price of 1.95 per share. Please also confirm Ocean Power Technolo total risk alpha, which is currently at 0.5597 to check out the company can sustain itself at a future point.

Our Final Take On Ocean Power

Whereas some firms in the electrical equipment & parts industry are either recovering or due for a correction, Ocean may not be as strong as the others in terms of longer-term growth potentials. While some private investors may not share our view, we believe that right now is not a good time to increase your holdings in Ocean. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Ocean Power.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of Ocean Power. Please refer to our Terms of Use for any information regarding our disclosure principles.

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