Correlation Between CleanTech Lithium and Finnair Oyj
Can any of the company-specific risk be diversified away by investing in both CleanTech Lithium and Finnair 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 CleanTech Lithium and Finnair Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CleanTech Lithium plc and Finnair Oyj, you can compare the effects of market volatilities on CleanTech Lithium and Finnair 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 CleanTech Lithium with a short position of Finnair Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of CleanTech Lithium and Finnair Oyj.
Diversification Opportunities for CleanTech Lithium and Finnair Oyj
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CleanTech and Finnair is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding CleanTech Lithium plc and Finnair Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnair Oyj and CleanTech Lithium 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 CleanTech Lithium plc are associated (or correlated) with Finnair Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnair Oyj has no effect on the direction of CleanTech Lithium i.e., CleanTech Lithium and Finnair Oyj go up and down completely randomly.
Pair Corralation between CleanTech Lithium and Finnair Oyj
Assuming the 90 days trading horizon CleanTech Lithium is expected to generate 2.14 times less return on investment than Finnair Oyj. In addition to that, CleanTech Lithium is 2.5 times more volatile than Finnair Oyj. It trades about 0.05 of its total potential returns per unit of risk. Finnair Oyj is currently generating about 0.27 per unit of volatility. If you would invest 228.00 in Finnair Oyj on November 3, 2024 and sell it today you would earn a total of 23.00 from holding Finnair Oyj or generate 10.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CleanTech Lithium plc vs. Finnair Oyj
Performance |
| Timeline |
| CleanTech Lithium plc |
| Finnair Oyj |
CleanTech Lithium and Finnair Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CleanTech Lithium and Finnair Oyj
The main advantage of trading using opposite CleanTech Lithium and Finnair Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CleanTech Lithium position performs unexpectedly, Finnair 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 Finnair Oyj will offset losses from the drop in Finnair Oyj's long position.| CleanTech Lithium vs. Electronic Arts | CleanTech Lithium vs. LPKF Laser Electronics | CleanTech Lithium vs. Compal Electronics GDR | CleanTech Lithium vs. Summit Materials Cl |
| Finnair Oyj vs. JD Sports Fashion | Finnair Oyj vs. XLMedia PLC | Finnair Oyj vs. Ameriprise Financial | Finnair Oyj vs. Hollywood Bowl Group |
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.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |