Correlation Between TERADATA and OSRAM LICHT
Can any of the company-specific risk be diversified away by investing in both TERADATA and OSRAM LICHT 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 TERADATA and OSRAM LICHT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TERADATA and OSRAM LICHT N, you can compare the effects of market volatilities on TERADATA and OSRAM LICHT 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 TERADATA with a short position of OSRAM LICHT. Check out your portfolio center. Please also check ongoing floating volatility patterns of TERADATA and OSRAM LICHT.
Diversification Opportunities for TERADATA and OSRAM LICHT
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TERADATA and OSRAM is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding TERADATA and OSRAM LICHT N in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSRAM LICHT N and TERADATA 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 TERADATA are associated (or correlated) with OSRAM LICHT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSRAM LICHT N has no effect on the direction of TERADATA i.e., TERADATA and OSRAM LICHT go up and down completely randomly.
Pair Corralation between TERADATA and OSRAM LICHT
Assuming the 90 days trading horizon TERADATA is expected to under-perform the OSRAM LICHT. In addition to that, TERADATA is 2.12 times more volatile than OSRAM LICHT N. It trades about -0.1 of its total potential returns per unit of risk. OSRAM LICHT N is currently generating about 0.07 per unit of volatility. If you would invest 5,180 in OSRAM LICHT N on October 12, 2024 and sell it today you would earn a total of 20.00 from holding OSRAM LICHT N or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
TERADATA vs. OSRAM LICHT N
Performance |
| Timeline |
| TERADATA |
| OSRAM LICHT N |
TERADATA and OSRAM LICHT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TERADATA and OSRAM LICHT
The main advantage of trading using opposite TERADATA and OSRAM LICHT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TERADATA position performs unexpectedly, OSRAM LICHT 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 OSRAM LICHT will offset losses from the drop in OSRAM LICHT's long position.| TERADATA vs. Charter Communications | TERADATA vs. SK TELECOM TDADR | TERADATA vs. Telecom Argentina SA | TERADATA vs. TOMBADOR IRON LTD |
| OSRAM LICHT vs. TERADATA | OSRAM LICHT vs. Northern Data AG | OSRAM LICHT vs. Lendlease Group | OSRAM LICHT vs. Cass Information Systems |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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