Correlation Between Industrivarden and Oakley Capital
Can any of the company-specific risk be diversified away by investing in both Industrivarden and Oakley Capital 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 Industrivarden and Oakley Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Industrivarden AB ser and Oakley Capital Investments, you can compare the effects of market volatilities on Industrivarden and Oakley Capital 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 Industrivarden with a short position of Oakley Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrivarden and Oakley Capital.
Diversification Opportunities for Industrivarden and Oakley Capital
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Industrivarden and Oakley is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Industrivarden AB ser and Oakley Capital Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakley Capital Inves and Industrivarden 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 Industrivarden AB ser are associated (or correlated) with Oakley Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakley Capital Inves has no effect on the direction of Industrivarden i.e., Industrivarden and Oakley Capital go up and down completely randomly.
Pair Corralation between Industrivarden and Oakley Capital
Assuming the 90 days trading horizon Industrivarden AB ser is expected to under-perform the Oakley Capital. But the stock apears to be less risky and, when comparing its historical volatility, Industrivarden AB ser is 1.35 times less risky than Oakley Capital. The stock trades about -0.06 of its potential returns per unit of risk. The Oakley Capital Investments is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 50,000 in Oakley Capital Investments on September 12, 2024 and sell it today you would earn a total of 400.00 from holding Oakley Capital Investments or generate 0.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrivarden AB ser vs. Oakley Capital Investments
Performance |
| Timeline |
| Industrivarden AB ser |
| Oakley Capital Inves |
Industrivarden and Oakley Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrivarden and Oakley Capital
The main advantage of trading using opposite Industrivarden and Oakley Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrivarden position performs unexpectedly, Oakley Capital 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 Oakley Capital will offset losses from the drop in Oakley Capital's long position.| Industrivarden vs. Oakley Capital Investments | Industrivarden vs. Aurora Investment Trust | Industrivarden vs. Target Healthcare REIT | Industrivarden vs. Universal Health Services |
| Oakley Capital vs. Gaztransport et Technigaz | Oakley Capital vs. Griffin Mining | Oakley Capital vs. Atalaya Mining | Oakley Capital vs. GoldMining |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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