Correlation Between Alma Media and Wulff Yhtiot
Can any of the company-specific risk be diversified away by investing in both Alma Media and Wulff Yhtiot 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 Wulff Yhtiot 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 Wulff Yhtiot Oy, you can compare the effects of market volatilities on Alma Media and Wulff Yhtiot 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 Wulff Yhtiot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alma Media and Wulff Yhtiot.
Diversification Opportunities for Alma Media and Wulff Yhtiot
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alma and Wulff is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Alma Media Oyj and Wulff Yhtiot Oy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wulff Yhtiot Oy 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 Wulff Yhtiot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wulff Yhtiot Oy has no effect on the direction of Alma Media i.e., Alma Media and Wulff Yhtiot go up and down completely randomly.
Pair Corralation between Alma Media and Wulff Yhtiot
Assuming the 90 days trading horizon Alma Media Oyj is expected to generate 0.85 times more return on investment than Wulff Yhtiot. However, Alma Media Oyj is 1.17 times less risky than Wulff Yhtiot. It trades about 0.29 of its potential returns per unit of risk. Wulff Yhtiot Oy is currently generating about 0.12 per unit of risk. If you would invest 1,075 in Alma Media Oyj on September 12, 2024 and sell it today you would earn a total of 115.00 from holding Alma Media Oyj or generate 10.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alma Media Oyj vs. Wulff Yhtiot Oy
Performance |
| Timeline |
| Alma Media Oyj |
| Wulff Yhtiot Oy |
Alma Media and Wulff Yhtiot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alma Media and Wulff Yhtiot
The main advantage of trading using opposite Alma Media and Wulff Yhtiot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alma Media position performs unexpectedly, Wulff Yhtiot 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 Wulff Yhtiot will offset losses from the drop in Wulff Yhtiot's long position.| Alma Media vs. Tokmanni Group Oyj | Alma Media vs. Kemira Oyj | Alma Media vs. Elisa Oyj | Alma Media vs. Valmet Oyj |
| Wulff Yhtiot vs. Reka Industrial Oyj | Wulff Yhtiot vs. QPR Software Oyj | Wulff Yhtiot vs. Nordea Bank Abp | Wulff Yhtiot vs. Nightingale Health Oyj |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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