Correlation Between Growth Fund and Lassila Tikanoja
Can any of the company-specific risk be diversified away by investing in both Growth Fund and Lassila Tikanoja 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 Growth Fund and Lassila Tikanoja into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Fund Of and Lassila Tikanoja Oyj, you can compare the effects of market volatilities on Growth Fund and Lassila Tikanoja 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 Growth Fund with a short position of Lassila Tikanoja. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Lassila Tikanoja.
Diversification Opportunities for Growth Fund and Lassila Tikanoja
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Growth and Lassila is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Lassila Tikanoja Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lassila Tikanoja Oyj and Growth Fund 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 Growth Fund Of are associated (or correlated) with Lassila Tikanoja. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lassila Tikanoja Oyj has no effect on the direction of Growth Fund i.e., Growth Fund and Lassila Tikanoja go up and down completely randomly.
Pair Corralation between Growth Fund and Lassila Tikanoja
Assuming the 90 days horizon Growth Fund is expected to generate 2.02 times less return on investment than Lassila Tikanoja. In addition to that, Growth Fund is 1.2 times more volatile than Lassila Tikanoja Oyj. It trades about 0.05 of its total potential returns per unit of risk. Lassila Tikanoja Oyj is currently generating about 0.13 per unit of volatility. If you would invest 827.00 in Lassila Tikanoja Oyj on November 3, 2024 and sell it today you would earn a total of 38.00 from holding Lassila Tikanoja Oyj or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 92.68% |
| Values | Daily Returns |
Growth Fund Of vs. Lassila Tikanoja Oyj
Performance |
| Timeline |
| Growth Fund |
| Lassila Tikanoja Oyj |
Growth Fund and Lassila Tikanoja Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Lassila Tikanoja
The main advantage of trading using opposite Growth Fund and Lassila Tikanoja positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Lassila Tikanoja 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 Lassila Tikanoja will offset losses from the drop in Lassila Tikanoja's long position.| Growth Fund vs. Capital World Growth | Growth Fund vs. Europacific Growth Fund | Growth Fund vs. New Perspective Fund | Growth Fund vs. Investment Of America |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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