Correlation Between Compagnie Plastic and ONEOK
Can any of the company-specific risk be diversified away by investing in both Compagnie Plastic and ONEOK 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 Compagnie Plastic and ONEOK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie Plastic Omnium and ONEOK Inc, you can compare the effects of market volatilities on Compagnie Plastic and ONEOK 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 Compagnie Plastic with a short position of ONEOK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Plastic and ONEOK.
Diversification Opportunities for Compagnie Plastic and ONEOK
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Compagnie and ONEOK is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and ONEOK Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONEOK Inc and Compagnie Plastic 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 Compagnie Plastic Omnium are associated (or correlated) with ONEOK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONEOK Inc has no effect on the direction of Compagnie Plastic i.e., Compagnie Plastic and ONEOK go up and down completely randomly.
Pair Corralation between Compagnie Plastic and ONEOK
Assuming the 90 days trading horizon Compagnie Plastic Omnium is expected to under-perform the ONEOK. In addition to that, Compagnie Plastic is 1.52 times more volatile than ONEOK Inc. It trades about -0.06 of its total potential returns per unit of risk. ONEOK Inc is currently generating about -0.08 per unit of volatility. If you would invest 10,053 in ONEOK Inc on November 6, 2024 and sell it today you would lose (304.00) from holding ONEOK Inc or give up 3.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compagnie Plastic Omnium vs. ONEOK Inc
Performance |
| Timeline |
| Compagnie Plastic Omnium |
| ONEOK Inc |
Compagnie Plastic and ONEOK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie Plastic and ONEOK
The main advantage of trading using opposite Compagnie Plastic and ONEOK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Plastic position performs unexpectedly, ONEOK 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 ONEOK will offset losses from the drop in ONEOK's long position.| Compagnie Plastic vs. Cornish Metals | Compagnie Plastic vs. Tatton Asset Management | Compagnie Plastic vs. URU Metals | Compagnie Plastic vs. Fulcrum Metals PLC |
| ONEOK vs. Pressure Technologies Plc | ONEOK vs. Central Asia Metals | ONEOK vs. URU Metals | ONEOK vs. Playtech Plc |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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