Correlation Between Gruppo MutuiOnline and Finnair Oyj
Can any of the company-specific risk be diversified away by investing in both Gruppo MutuiOnline and Finnair Oyj 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 Gruppo MutuiOnline and Finnair Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gruppo MutuiOnline SpA and Finnair Oyj, you can compare the effects of market volatilities on Gruppo MutuiOnline and Finnair Oyj 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 Gruppo MutuiOnline with a short position of Finnair Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gruppo MutuiOnline and Finnair Oyj.
Diversification Opportunities for Gruppo MutuiOnline and Finnair Oyj
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gruppo and Finnair is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Gruppo MutuiOnline SpA and Finnair Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnair Oyj and Gruppo MutuiOnline 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 Gruppo MutuiOnline SpA are associated (or correlated) with Finnair Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnair Oyj has no effect on the direction of Gruppo MutuiOnline i.e., Gruppo MutuiOnline and Finnair Oyj go up and down completely randomly.
Pair Corralation between Gruppo MutuiOnline and Finnair Oyj
Assuming the 90 days trading horizon Gruppo MutuiOnline SpA is expected to generate 12.0 times more return on investment than Finnair Oyj. However, Gruppo MutuiOnline is 12.0 times more volatile than Finnair Oyj. It trades about 0.14 of its potential returns per unit of risk. Finnair Oyj is currently generating about -0.07 per unit of risk. If you would invest 2,776 in Gruppo MutuiOnline SpA on September 14, 2024 and sell it today you would earn a total of 1,029 from holding Gruppo MutuiOnline SpA or generate 37.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 63.7% |
| Values | Daily Returns |
Gruppo MutuiOnline SpA vs. Finnair Oyj
Performance |
| Timeline |
| Gruppo MutuiOnline SpA |
| Finnair Oyj |
Gruppo MutuiOnline and Finnair Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gruppo MutuiOnline and Finnair Oyj
The main advantage of trading using opposite Gruppo MutuiOnline and Finnair Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gruppo MutuiOnline position performs unexpectedly, Finnair Oyj 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 Finnair Oyj will offset losses from the drop in Finnair Oyj's long position.| Gruppo MutuiOnline vs. Teradata Corp | Gruppo MutuiOnline vs. Datagroup SE | Gruppo MutuiOnline vs. Melia Hotels | Gruppo MutuiOnline vs. SBM Offshore NV |
| Finnair Oyj vs. Eastman Chemical Co | Finnair Oyj vs. Gruppo MutuiOnline SpA | Finnair Oyj vs. Westlake Chemical Corp | Finnair Oyj vs. Gamma Communications 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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