Correlation Between Yelp and OB Old

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

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

Diversification Opportunities for Yelp and OB Old

0.64

Correlation Coefficient

Yelp  OB Old

Poor diversification

The 3 months correlation between Yelp and OB Old is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Yelp Inc and OB Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OB Old and Yelp 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 Yelp Inc are associated (or correlated) with OB Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OB Old has no effect on the direction of Yelp i.e., Yelp and OB Old go up and down completely randomly.

Pair Corralation between Yelp and OB Old

If you would invest  274.00  in OB Old on September 6, 2025 and sell it today you would earn a total of  0.00  from holding OB Old or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.59%
Values	Daily Returns

Yelp Inc  vs.  OB Old

Yelp Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Yelp Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, Yelp is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

OB Old

Risk-Adjusted Performance

Weakest

Over the last 90 days OB Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, OB Old is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Yelp and OB Old

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

The idea behind Yelp Inc and OB Old 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.