Correlation Between ALSO Holding and Optima Health
Can any of the company-specific risk be diversified away by investing in both ALSO Holding and Optima Health 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 ALSO Holding and Optima Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALSO Holding AG and Optima Health plc, you can compare the effects of market volatilities on ALSO Holding and Optima Health 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 ALSO Holding with a short position of Optima Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALSO Holding and Optima Health.
Diversification Opportunities for ALSO Holding and Optima Health
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ALSO and Optima is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding ALSO Holding AG and Optima Health plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optima Health plc and ALSO Holding 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 ALSO Holding AG are associated (or correlated) with Optima Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optima Health plc has no effect on the direction of ALSO Holding i.e., ALSO Holding and Optima Health go up and down completely randomly.
Pair Corralation between ALSO Holding and Optima Health
Assuming the 90 days trading horizon ALSO Holding AG is expected to generate 1.29 times more return on investment than Optima Health. However, ALSO Holding is 1.29 times more volatile than Optima Health plc. It trades about 0.05 of its potential returns per unit of risk. Optima Health plc is currently generating about 0.05 per unit of risk. If you would invest 17,127 in ALSO Holding AG on September 2, 2024 and sell it today you would earn a total of 6,173 from holding ALSO Holding AG or generate 36.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 9.62% |
| Values | Daily Returns |
ALSO Holding AG vs. Optima Health plc
Performance |
| Timeline |
| ALSO Holding AG |
| Optima Health plc |
ALSO Holding and Optima Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALSO Holding and Optima Health
The main advantage of trading using opposite ALSO Holding and Optima Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALSO Holding position performs unexpectedly, Optima Health 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 Optima Health will offset losses from the drop in Optima Health's long position.| ALSO Holding vs. Uniper SE | ALSO Holding vs. Mulberry Group PLC | ALSO Holding vs. London Security Plc | ALSO Holding vs. Triad Group PLC |
| Optima Health vs. Toyota Motor Corp | Optima Health vs. OTP Bank Nyrt | Optima Health vs. Las Vegas Sands | Optima Health vs. Yum Brands |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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