Correlation Between Omnicom and CyberAgent

Can any of the company-specific risk be diversified away by investing in both Omnicom and CyberAgent 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 Omnicom and CyberAgent into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Omnicom Group and CyberAgent, you can compare the effects of market volatilities on Omnicom and CyberAgent 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 Omnicom with a short position of CyberAgent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omnicom and CyberAgent.

Diversification Opportunities for Omnicom and CyberAgent

-0.71

Correlation Coefficient

Omnicom  CyberAgent

Pay attention - limited upside

The 3 months correlation between Omnicom and CyberAgent is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Omnicom Group and CyberAgent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CyberAgent and Omnicom 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 Omnicom Group are associated (or correlated) with CyberAgent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CyberAgent has no effect on the direction of Omnicom i.e., Omnicom and CyberAgent go up and down completely randomly.

Pair Corralation between Omnicom and CyberAgent

Assuming the 90 days horizon Omnicom Group is expected to under-perform the CyberAgent. But the stock apears to be less risky and, when comparing its historical volatility, Omnicom Group is 1.54 times less risky than CyberAgent. The stock trades about -0.06 of its potential returns per unit of risk. The CyberAgent is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  720.00  in CyberAgent on April 23, 2025 and sell it today you would earn a total of  170.00  from holding CyberAgent or generate 23.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Omnicom Group  vs.  CyberAgent

Omnicom Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Omnicom Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain 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.

CyberAgent

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CyberAgent are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CyberAgent reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Omnicom and CyberAgent

The main advantage of trading using opposite Omnicom and CyberAgent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omnicom position performs unexpectedly, CyberAgent 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 CyberAgent will offset losses from the drop in CyberAgent's long position.

The idea behind Omnicom Group and CyberAgent 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.