Correlation Between EVN AG and OMV Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both EVN AG and OMV Aktiengesellscha 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 EVN AG and OMV Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EVN AG and OMV Aktiengesellschaft, you can compare the effects of market volatilities on EVN AG and OMV Aktiengesellscha 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 EVN AG with a short position of OMV Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVN AG and OMV Aktiengesellscha.
Diversification Opportunities for EVN AG and OMV Aktiengesellscha
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EVN and OMV is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding EVN AG and OMV Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OMV Aktiengesellschaft and EVN AG 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 EVN AG are associated (or correlated) with OMV Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OMV Aktiengesellschaft has no effect on the direction of EVN AG i.e., EVN AG and OMV Aktiengesellscha go up and down completely randomly.
Pair Corralation between EVN AG and OMV Aktiengesellscha
Assuming the 90 days trading horizon EVN AG is expected to under-perform the OMV Aktiengesellscha. In addition to that, EVN AG is 1.63 times more volatile than OMV Aktiengesellschaft. It trades about -0.15 of its total potential returns per unit of risk. OMV Aktiengesellschaft is currently generating about -0.07 per unit of volatility. If you would invest 3,852 in OMV Aktiengesellschaft on August 31, 2024 and sell it today you would lose (62.00) from holding OMV Aktiengesellschaft or give up 1.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EVN AG vs. OMV Aktiengesellschaft
Performance |
| Timeline |
| EVN AG |
| OMV Aktiengesellschaft |
EVN AG and OMV Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EVN AG and OMV Aktiengesellscha
The main advantage of trading using opposite EVN AG and OMV Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EVN AG position performs unexpectedly, OMV Aktiengesellscha 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 OMV Aktiengesellscha will offset losses from the drop in OMV Aktiengesellscha's long position.The idea behind EVN AG and OMV Aktiengesellschaft pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| OMV Aktiengesellscha vs. Voestalpine AG | OMV Aktiengesellscha vs. Erste Group Bank | OMV Aktiengesellscha vs. Raiffeisen Bank International | OMV Aktiengesellscha vs. VERBUND 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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