Correlation Between Capital Income and Lassila Tikanoja
Can any of the company-specific risk be diversified away by investing in both Capital Income 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 Capital Income and Lassila Tikanoja into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Income Builder and Lassila Tikanoja Oyj, you can compare the effects of market volatilities on Capital Income 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 Capital Income with a short position of Lassila Tikanoja. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Income and Lassila Tikanoja.
Diversification Opportunities for Capital Income and Lassila Tikanoja
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Capital and Lassila is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Capital Income Builder 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 Capital Income 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 Capital Income Builder 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 Capital Income i.e., Capital Income and Lassila Tikanoja go up and down completely randomly.
Pair Corralation between Capital Income and Lassila Tikanoja
Assuming the 90 days horizon Capital Income Builder is expected to under-perform the Lassila Tikanoja. But the mutual fund apears to be less risky and, when comparing its historical volatility, Capital Income Builder is 1.25 times less risky than Lassila Tikanoja. The mutual fund trades about -0.05 of its potential returns per unit of risk. The Lassila Tikanoja Oyj is currently generating about 0.13 of returns per unit of risk over similar time horizon. 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 Together |
| Strength | Weak |
| Accuracy | 92.68% |
| Values | Daily Returns |
Capital Income Builder vs. Lassila Tikanoja Oyj
Performance |
| Timeline |
| Capital Income Builder |
| Lassila Tikanoja Oyj |
Capital Income and Lassila Tikanoja Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Income and Lassila Tikanoja
The main advantage of trading using opposite Capital Income and Lassila Tikanoja positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Income 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.| Capital Income vs. Dws Global Macro | Capital Income vs. Rbb Fund | Capital Income vs. Kinetics Global Fund | Capital Income vs. Ms Global Fixed |
| Lassila Tikanoja vs. Tokmanni Group Oyj | Lassila Tikanoja vs. TietoEVRY Corp | Lassila Tikanoja vs. Kemira Oyj | Lassila Tikanoja vs. Konecranes Plc |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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