Correlation Between Gaztransport and Oakley Capital
Can any of the company-specific risk be diversified away by investing in both Gaztransport 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 Gaztransport and Oakley Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport et Technigaz and Oakley Capital Investments, you can compare the effects of market volatilities on Gaztransport 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 Gaztransport with a short position of Oakley Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and Oakley Capital.
Diversification Opportunities for Gaztransport and Oakley Capital
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gaztransport and Oakley is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz 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 Gaztransport 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 Gaztransport et Technigaz 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 Gaztransport i.e., Gaztransport and Oakley Capital go up and down completely randomly.
Pair Corralation between Gaztransport and Oakley Capital
Assuming the 90 days trading horizon Gaztransport et Technigaz is expected to under-perform the Oakley Capital. But the stock apears to be less risky and, when comparing its historical volatility, Gaztransport et Technigaz is 1.33 times less risky than Oakley Capital. The stock trades about -0.19 of its potential returns per unit of risk. The Oakley Capital Investments is currently generating about 0.09 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 1,200 from holding Oakley Capital Investments or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport et Technigaz vs. Oakley Capital Investments
Performance |
| Timeline |
| Gaztransport et Technigaz |
| Oakley Capital Inves |
Gaztransport and Oakley Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport and Oakley Capital
The main advantage of trading using opposite Gaztransport and Oakley Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport 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.| Gaztransport vs. MyHealthChecked Plc | Gaztransport vs. Hansa Investment | Gaztransport vs. Oakley Capital Investments | Gaztransport vs. HCA Healthcare |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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