Correlation Between AFFLUENT MEDICAL and OPERA SOFTWARE

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Can any of the company-specific risk be diversified away by investing in both AFFLUENT MEDICAL and OPERA SOFTWARE 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 AFFLUENT MEDICAL and OPERA SOFTWARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AFFLUENT MEDICAL SAS and OPERA SOFTWARE, you can compare the effects of market volatilities on AFFLUENT MEDICAL and OPERA SOFTWARE 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 AFFLUENT MEDICAL with a short position of OPERA SOFTWARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of AFFLUENT MEDICAL and OPERA SOFTWARE.

Diversification Opportunities for AFFLUENT MEDICAL and OPERA SOFTWARE

-0.07
  Correlation Coefficient

Good diversification

The 3 months correlation between AFFLUENT and OPERA is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding AFFLUENT MEDICAL SAS and OPERA SOFTWARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPERA SOFTWARE and AFFLUENT MEDICAL 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 AFFLUENT MEDICAL SAS are associated (or correlated) with OPERA SOFTWARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPERA SOFTWARE has no effect on the direction of AFFLUENT MEDICAL i.e., AFFLUENT MEDICAL and OPERA SOFTWARE go up and down completely randomly.

Pair Corralation between AFFLUENT MEDICAL and OPERA SOFTWARE

Assuming the 90 days horizon AFFLUENT MEDICAL SAS is expected to under-perform the OPERA SOFTWARE. In addition to that, AFFLUENT MEDICAL is 1.12 times more volatile than OPERA SOFTWARE. It trades about -0.04 of its total potential returns per unit of risk. OPERA SOFTWARE is currently generating about 0.32 per unit of volatility. If you would invest  72.00  in OPERA SOFTWARE on April 20, 2025 and sell it today you would earn a total of  40.00  from holding OPERA SOFTWARE or generate 55.56% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

AFFLUENT MEDICAL SAS  vs.  OPERA SOFTWARE

 Performance 
       Timeline  
AFFLUENT MEDICAL SAS 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days AFFLUENT MEDICAL SAS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.
OPERA SOFTWARE 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in OPERA SOFTWARE are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, OPERA SOFTWARE unveiled solid returns over the last few months and may actually be approaching a breakup point.

AFFLUENT MEDICAL and OPERA SOFTWARE Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with AFFLUENT MEDICAL and OPERA SOFTWARE

The main advantage of trading using opposite AFFLUENT MEDICAL and OPERA SOFTWARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AFFLUENT MEDICAL position performs unexpectedly, OPERA SOFTWARE 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 OPERA SOFTWARE will offset losses from the drop in OPERA SOFTWARE's long position.
The idea behind AFFLUENT MEDICAL SAS and OPERA SOFTWARE 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.
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

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