Correlation Between Aldel Financial and Oatly Group
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and Oatly Group 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 Aldel Financial and Oatly Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and Oatly Group AB, you can compare the effects of market volatilities on Aldel Financial and Oatly Group 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 Aldel Financial with a short position of Oatly Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and Oatly Group.
Diversification Opportunities for Aldel Financial and Oatly Group
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aldel and Oatly is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and Oatly Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oatly Group AB and Aldel Financial 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 Aldel Financial II are associated (or correlated) with Oatly Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oatly Group AB has no effect on the direction of Aldel Financial i.e., Aldel Financial and Oatly Group go up and down completely randomly.
Pair Corralation between Aldel Financial and Oatly Group
Assuming the 90 days horizon Aldel Financial is expected to generate 22.22 times less return on investment than Oatly Group. But when comparing it to its historical volatility, Aldel Financial II is 34.33 times less risky than Oatly Group. It trades about 0.08 of its potential returns per unit of risk. Oatly Group AB is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 69.00 in Oatly Group AB on September 13, 2024 and sell it today you would earn a total of 2.00 from holding Oatly Group AB or generate 2.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aldel Financial II vs. Oatly Group AB
Performance |
| Timeline |
| Aldel Financial II |
| Oatly Group AB |
Aldel Financial and Oatly Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and Oatly Group
The main advantage of trading using opposite Aldel Financial and Oatly Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, Oatly Group 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 Oatly Group will offset losses from the drop in Oatly Group's long position.| Aldel Financial vs. Distoken Acquisition | Aldel Financial vs. dMY Squared Technology | Aldel Financial vs. YHN Acquisition I | Aldel Financial vs. YHN Acquisition I |
| Oatly Group vs. Monster Beverage Corp | Oatly Group vs. Vita Coco | Oatly Group vs. PepsiCo | Oatly Group vs. The Coca Cola |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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