Correlation Between CapMan Oyj and United Bankers
Can any of the company-specific risk be diversified away by investing in both CapMan Oyj and United Bankers 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 CapMan Oyj and United Bankers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CapMan Oyj B and United Bankers Oyj, you can compare the effects of market volatilities on CapMan Oyj and United Bankers 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 CapMan Oyj with a short position of United Bankers. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapMan Oyj and United Bankers.
Diversification Opportunities for CapMan Oyj and United Bankers
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between CapMan and United is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding CapMan Oyj B and United Bankers Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Bankers Oyj and CapMan Oyj 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 CapMan Oyj B are associated (or correlated) with United Bankers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Bankers Oyj has no effect on the direction of CapMan Oyj i.e., CapMan Oyj and United Bankers go up and down completely randomly.
Pair Corralation between CapMan Oyj and United Bankers
Assuming the 90 days trading horizon CapMan Oyj B is expected to generate 1.17 times more return on investment than United Bankers. However, CapMan Oyj is 1.17 times more volatile than United Bankers Oyj. It trades about 0.0 of its potential returns per unit of risk. United Bankers Oyj is currently generating about -0.18 per unit of risk. If you would invest 183.00 in CapMan Oyj B on August 30, 2024 and sell it today you would lose (1.00) from holding CapMan Oyj B or give up 0.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CapMan Oyj B vs. United Bankers Oyj
Performance |
| Timeline |
| CapMan Oyj B |
| United Bankers Oyj |
CapMan Oyj and United Bankers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CapMan Oyj and United Bankers
The main advantage of trading using opposite CapMan Oyj and United Bankers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapMan Oyj position performs unexpectedly, United Bankers 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 United Bankers will offset losses from the drop in United Bankers' long position.| CapMan Oyj vs. United Bankers Oyj | CapMan Oyj vs. SSH Communications Security | CapMan Oyj vs. Alma Media Oyj | CapMan Oyj vs. Nightingale Health Oyj |
| United Bankers vs. Alandsbanken Abp A | United Bankers vs. Nordea Bank Abp | United Bankers vs. SSH Communications Security | United Bankers vs. Tamtron Group 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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