Correlation Between First Helium and Origin Materials

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

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

Diversification Opportunities for First Helium and Origin Materials

0.57

Correlation Coefficient

First Helium  Origin Materials

Very weak diversification

The 3 months correlation between First and Origin is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding First Helium and Origin Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Materials and First Helium 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 First Helium are associated (or correlated) with Origin Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Materials has no effect on the direction of First Helium i.e., First Helium and Origin Materials go up and down completely randomly.

Pair Corralation between First Helium and Origin Materials

Assuming the 90 days horizon First Helium is expected to under-perform the Origin Materials. But the otc stock apears to be less risky and, when comparing its historical volatility, First Helium is 1.03 times less risky than Origin Materials. The otc stock trades about -0.01 of its potential returns per unit of risk. The Origin Materials is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  68.00  in Origin Materials on May 1, 2025 and sell it today you would earn a total of  5.00  from holding Origin Materials or generate 7.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

First Helium  vs.  Origin Materials

First Helium

Risk-Adjusted Performance

Very Weak

Over the last 90 days First Helium has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, First Helium is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Origin Materials

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Origin Materials are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting technical and fundamental indicators, Origin Materials displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with First Helium and Origin Materials

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

The idea behind First Helium and Origin Materials 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.