Correlation Between Alma Media and CapMan Oyj
Can any of the company-specific risk be diversified away by investing in both Alma Media and CapMan Oyj 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 Alma Media and CapMan Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alma Media Oyj and CapMan Oyj B, you can compare the effects of market volatilities on Alma Media and CapMan Oyj 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 Alma Media with a short position of CapMan Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alma Media and CapMan Oyj.
Diversification Opportunities for Alma Media and CapMan Oyj
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Alma and CapMan is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Alma Media Oyj and CapMan Oyj B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapMan Oyj B and Alma Media 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 Alma Media Oyj are associated (or correlated) with CapMan Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapMan Oyj B has no effect on the direction of Alma Media i.e., Alma Media and CapMan Oyj go up and down completely randomly.
Pair Corralation between Alma Media and CapMan Oyj
Assuming the 90 days trading horizon Alma Media Oyj is expected to generate 1.29 times more return on investment than CapMan Oyj. However, Alma Media is 1.29 times more volatile than CapMan Oyj B. It trades about 0.1 of its potential returns per unit of risk. CapMan Oyj B is currently generating about -0.1 per unit of risk. If you would invest 1,120 in Alma Media Oyj on September 2, 2024 and sell it today you would earn a total of 40.00 from holding Alma Media Oyj or generate 3.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alma Media Oyj vs. CapMan Oyj B
Performance |
| Timeline |
| Alma Media Oyj |
| CapMan Oyj B |
Alma Media and CapMan Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alma Media and CapMan Oyj
The main advantage of trading using opposite Alma Media and CapMan Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alma Media position performs unexpectedly, CapMan Oyj 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 CapMan Oyj will offset losses from the drop in CapMan Oyj's long position.| Alma Media vs. Tokmanni Group Oyj | Alma Media vs. Kemira Oyj | Alma Media vs. Elisa Oyj | Alma Media vs. Valmet Oyj |
| CapMan Oyj vs. Nordea Bank Abp | CapMan Oyj vs. Telia Company AB | CapMan Oyj vs. Fortum Oyj | CapMan Oyj vs. SSAB AB ser |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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