Correlation Between CNH Industrial and Oesterr Post
Can any of the company-specific risk be diversified away by investing in both CNH Industrial and Oesterr Post 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 CNH Industrial and Oesterr Post into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNH Industrial NV and Oesterr Post AG, you can compare the effects of market volatilities on CNH Industrial and Oesterr Post 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 CNH Industrial with a short position of Oesterr Post. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNH Industrial and Oesterr Post.
Diversification Opportunities for CNH Industrial and Oesterr Post
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CNH and Oesterr is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding CNH Industrial NV and Oesterr Post AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oesterr Post AG and CNH Industrial 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 CNH Industrial NV are associated (or correlated) with Oesterr Post. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oesterr Post AG has no effect on the direction of CNH Industrial i.e., CNH Industrial and Oesterr Post go up and down completely randomly.
Pair Corralation between CNH Industrial and Oesterr Post
Assuming the 90 days trading horizon CNH Industrial NV is expected to generate 2.63 times more return on investment than Oesterr Post. However, CNH Industrial is 2.63 times more volatile than Oesterr Post AG. It trades about 0.16 of its potential returns per unit of risk. Oesterr Post AG is currently generating about -0.12 per unit of risk. If you would invest 1,034 in CNH Industrial NV on September 18, 2024 and sell it today you would earn a total of 74.00 from holding CNH Industrial NV or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CNH Industrial NV vs. Oesterr Post AG
Performance |
| Timeline |
| CNH Industrial NV |
| Oesterr Post AG |
CNH Industrial and Oesterr Post Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNH Industrial and Oesterr Post
The main advantage of trading using opposite CNH Industrial and Oesterr Post positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNH Industrial position performs unexpectedly, Oesterr Post 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 Oesterr Post will offset losses from the drop in Oesterr Post's long position.| CNH Industrial vs. RATH Aktiengesellschaft | CNH Industrial vs. AT S Austria | CNH Industrial vs. BAWAG Group AG | CNH Industrial vs. Semperit Aktiengesellschaft Holding |
| Oesterr Post vs. Voestalpine AG | Oesterr Post vs. VERBUND AG | Oesterr Post vs. OMV Aktiengesellschaft | Oesterr Post vs. Wienerberger AG |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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