Correlation Between Terminal X and Oramed Pharmaceuticals

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

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

Diversification Opportunities for Terminal X and Oramed Pharmaceuticals

-0.57

Correlation Coefficient

Terminal X  Oramed Pharmaceuticals

Excellent diversification

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

Pair Corralation between Terminal X and Oramed Pharmaceuticals

Assuming the 90 days trading horizon Terminal X Online is expected to generate 0.62 times more return on investment than Oramed Pharmaceuticals. However, Terminal X Online is 1.61 times less risky than Oramed Pharmaceuticals. It trades about 0.24 of its potential returns per unit of risk. Oramed Pharmaceuticals is currently generating about -0.08 per unit of risk. If you would invest  44,690  in Terminal X Online on May 10, 2025 and sell it today you would earn a total of  8,410  from holding Terminal X Online or generate 18.82% return on investment over 90 days.

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

Terminal X Online  vs.  Oramed Pharmaceuticals

Terminal X Online

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Terminal X Online are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Terminal X sustained solid returns over the last few months and may actually be approaching a breakup point.

Oramed Pharmaceuticals

Risk-Adjusted Performance

Weakest

Over the last 90 days Oramed Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Terminal X and Oramed Pharmaceuticals

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

The idea behind Terminal X Online and Oramed Pharmaceuticals 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.

Check out your portfolio center.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.