Office Stock Volatility

ODP
 Stock
  

USD 35.03  0.12  0.34%   

Office Depot appears to be very steady, given 3 months investment horizon. Office Depot maintains Sharpe Ratio (i.e., Efficiency) of 0.1, which implies the firm had 0.1% of return per unit of risk over the last 3 months. Our standpoint towards forecasting the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Office Depot, which you can use to evaluate the future volatility of the company. Please evaluate Office Depot's Coefficient Of Variation of 948.19, risk adjusted performance of 0.1301, and Semi Deviation of 1.81 to confirm if our risk estimates are consistent with your expectations.
  
Office Depot Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Office daily returns, and it is calculated using variance and standard deviation. We also use Office's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Office Depot volatility.

30 Days Market Risk

Very steady

Chance of Distress

Below Average

30 Days Economic Sensitivity

Follows the market closely
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Office Depot can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Office Depot at lower prices. For example, an investor can purchase Office stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Office Depot's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Office Depot

+0.81ORLYOReilly AutomotivePairCorr
+0.74ANCTFAlimentat Cou MulvtgPairCorr
+0.81GPCGenuine PartsPairCorr

Office Depot Market Sensitivity And Downside Risk

Office Depot's beta coefficient measures the volatility of Office stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Office stock's returns against your selected market. In other words, Office Depot's beta of 0.74 provides an investor with an approximation of how much risk Office Depot stock can potentially add to one of your existing portfolios.
Office Depot has relatively low volatility with skewness of 1.77 and kurtosis of 8.78. However, we advise all investors to independently investigate Office Depot to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Office Depot's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Office Depot's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
3 Months Beta |Analyze Office Depot Demand Trend
Check current 90 days Office Depot correlation with market (DOW)

Office Beta

    
  0.74  
Office standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  2.33  
It is essential to understand the difference between upside risk (as represented by Office Depot's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Office Depot's daily returns or price. Since the actual investment returns on holding a position in office stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Office Depot.

Using Office Put Option to Manage Risk

Put options written on Office Depot grant holders of the option the right to sell a specified amount of Office Depot at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Office Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Office Depot's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Office Depot will be realized, the loss incurred will be offset by the profits made with the option trade.

Office Depot's PUT expiring on 2022-10-21

   Profit   
Share
       Office Depot Price At Expiration  

Current Office Depot Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2022-10-21 PUT at $30.0-0.15650.0405132022-10-210.05 - 1.00.05View
Put
2022-10-21 PUT at $35.0-0.47230.11461052022-10-211.2 - 1.51.47View
Put
2022-10-21 PUT at $36.0-0.55390.0865292022-10-211.75 - 2.951.55View
Put
2022-10-21 PUT at $37.0-0.60750.0716282022-10-210.4 - 3.30.93View
Put
2022-10-21 PUT at $38.0-0.74590.081912022-10-212.6 - 4.44.13View
Put
2022-10-21 PUT at $39.0-0.76340.106852022-10-213.7 - 5.43.7View
Put
2022-10-21 PUT at $40.0-0.71980.0497302022-10-213.3 - 6.04.7View
Put
2022-10-21 PUT at $45.0-0.88170.029112022-10-219.0 - 11.610.6View
View All Office Depot Options

Office Depot Stock Volatility Analysis

Volatility refers to the frequency at which Office Depot stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Office Depot's price changes. Investors will then calculate the volatility of Office Depot's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Office Depot's volatility:

Historical Volatility

This type of stock volatility measures Office Depot's fluctuations based on previous trends. It's commonly used to predict Office Depot's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Office Depot's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Office Depot's to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. The Median Price line plots median indexes of Office Depot price series.
.

Office Depot Projected Return Density Against Market

Considering the 90-day investment horizon Office Depot has a beta of 0.7431 . This indicates as returns on the market go up, Office Depot average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Office Depot will be expected to be much smaller as well.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Office Depot or Consumer Cyclical sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Office Depot's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Office stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.2902, implying that it can generate a 0.29 percent excess return over DOW after adjusting for the inherited market risk (beta).
   Predicted Return Density   
       Returns  
Office Depot's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how office stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives an Office Depot Price Volatility?

Several factors can influence a Stock's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Office Depot Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Office Depot or Consumer Cyclical sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Office Depot's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Office stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Considering the 90-day investment horizon the coefficient of variation of Office Depot is 955.3. The daily returns are distributed with a variance of 5.41 and standard deviation of 2.33. The mean deviation of Office Depot is currently at 1.5. For similar time horizon, the selected benchmark (DOW) has volatility of 1.19
α
Alpha over DOW
0.29
β
Beta against DOW0.74
σ
Overall volatility
2.33
Ir
Information ratio 0.13

Office Depot Stock Return Volatility

Office Depot historical daily return volatility represents how much of Office Depot stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm has volatility of 2.3262% on return distribution over 90 days investment horizon. By contrast, DOW inherits 1.2047% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
       Timeline  

About Office Depot Volatility

Volatility is a rate at which the price of Office Depot or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Office Depot may increase or decrease. In other words, similar to Office's beta indicator, it measures the risk of Office Depot and helps estimate the fluctuations that may happen in a short period of time. So if prices of Office Depot fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
The ODP Corporation provides business services and supplies, products, and digital workplace technology solutions for small, medium, and enterprise businesses. The ODP Corporation was incorporated in 1986 and is headquartered in Boca Raton, Florida. Office Depot operates under Specialty Retail classification in the United States and is traded on NASDAQ Exchange. It employs 26000 people.

Office Depot Investment Opportunity

Office Depot has a volatility of 2.33 and is 1.94 times more volatile than DOW. 20  of all equities and portfolios are less risky than Office Depot. Compared to the overall equity markets, volatility of historical daily returns of Office Depot is lower than 20 () of all global equities and portfolios over the last 90 days. Use Office Depot to protect your portfolios against small market fluctuations. Benchmarks are essential to demonstrate the utility of optimization algorithms. The stock experiences a normal downward trend and little activity. Check odds of Office Depot to be traded at $34.68 in 90 days.

Weak diversification

The correlation between Office Depot and DJI is 0.37 (i.e., Weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Office Depot and DJI in the same portfolio, assuming nothing else is changed.

Office Depot Additional Risk Indicators

The analysis of Office Depot's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Office Depot's investment and either accepting that risk or mitigating it. Along with some common measures of Office Depot stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Office Depot Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Office Depot as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Office Depot's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Office Depot's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Office Depot.
Please check Your Equity Center. Note that the Office Depot information on this page should be used as a complementary analysis to other Office Depot's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Equity Valuation module to check real value of public entities based on technical and fundamental data.

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When running Office Depot price analysis, check to measure Office Depot's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Office Depot is operating at the current time. Most of Office Depot's value examination focuses on studying past and present price action to predict the probability of Office Depot's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Office Depot's price. Additionally, you may evaluate how the addition of Office Depot to your portfolios can decrease your overall portfolio volatility.
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Is Office Depot's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Office Depot. If investors know Office will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Office Depot listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Office Depot is measured differently than its book value, which is the value of Office that is recorded on the company's balance sheet. Investors also form their own opinion of Office Depot's value that differs from its market value or its book value, called intrinsic value, which is Office Depot's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Office Depot's market value can be influenced by many factors that don't directly affect Office Depot's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Office Depot's value and its price as these two are different measures arrived at by different means. Investors typically determine Office Depot value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Office Depot's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.