Correlation Between ETC On and Oncimmune Holdings
Can any of the company-specific risk be diversified away by investing in both ETC On and Oncimmune Holdings 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 ETC On and Oncimmune Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETC on CMCI and Oncimmune Holdings plc, you can compare the effects of market volatilities on ETC On and Oncimmune Holdings 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 ETC On with a short position of Oncimmune Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETC On and Oncimmune Holdings.
Diversification Opportunities for ETC On and Oncimmune Holdings
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ETC and Oncimmune is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding ETC on CMCI and Oncimmune Holdings plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oncimmune Holdings plc and ETC On 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 ETC on CMCI are associated (or correlated) with Oncimmune Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oncimmune Holdings plc has no effect on the direction of ETC On i.e., ETC On and Oncimmune Holdings go up and down completely randomly.
Pair Corralation between ETC On and Oncimmune Holdings
Assuming the 90 days trading horizon ETC on CMCI is expected to generate 0.13 times more return on investment than Oncimmune Holdings. However, ETC on CMCI is 7.97 times less risky than Oncimmune Holdings. It trades about -0.03 of its potential returns per unit of risk. Oncimmune Holdings plc is currently generating about -0.01 per unit of risk. If you would invest 17,949 in ETC on CMCI on August 29, 2024 and sell it today you would lose (501.00) from holding ETC on CMCI or give up 2.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ETC on CMCI vs. Oncimmune Holdings plc
Performance |
| Timeline |
| ETC on CMCI |
| Oncimmune Holdings plc |
ETC On and Oncimmune Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETC On and Oncimmune Holdings
The main advantage of trading using opposite ETC On and Oncimmune Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETC On position performs unexpectedly, Oncimmune Holdings 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 Oncimmune Holdings will offset losses from the drop in Oncimmune Holdings' long position.The idea behind ETC on CMCI and Oncimmune Holdings plc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Oncimmune Holdings vs. JD Sports Fashion | Oncimmune Holdings vs. Polar Capital Technology | Oncimmune Holdings vs. Science in Sport | Oncimmune Holdings vs. Universal Display Corp |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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