Correlation Between Exel Composites and Oma Saastopankki
Can any of the company-specific risk be diversified away by investing in both Exel Composites and Oma Saastopankki 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 Exel Composites and Oma Saastopankki into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exel Composites Oyj and Oma Saastopankki Oyj, you can compare the effects of market volatilities on Exel Composites and Oma Saastopankki 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 Exel Composites with a short position of Oma Saastopankki. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exel Composites and Oma Saastopankki.
Diversification Opportunities for Exel Composites and Oma Saastopankki
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Exel and Oma is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Exel Composites Oyj and Oma Saastopankki Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oma Saastopankki Oyj and Exel Composites 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 Exel Composites Oyj are associated (or correlated) with Oma Saastopankki. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oma Saastopankki Oyj has no effect on the direction of Exel Composites i.e., Exel Composites and Oma Saastopankki go up and down completely randomly.
Pair Corralation between Exel Composites and Oma Saastopankki
Assuming the 90 days trading horizon Exel Composites Oyj is expected to under-perform the Oma Saastopankki. But the stock apears to be less risky and, when comparing its historical volatility, Exel Composites Oyj is 1.19 times less risky than Oma Saastopankki. The stock trades about -0.56 of its potential returns per unit of risk. The Oma Saastopankki Oyj is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 1,164 in Oma Saastopankki Oyj on August 30, 2024 and sell it today you would lose (82.00) from holding Oma Saastopankki Oyj or give up 7.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Exel Composites Oyj vs. Oma Saastopankki Oyj
Performance |
| Timeline |
| Exel Composites Oyj |
| Oma Saastopankki Oyj |
Exel Composites and Oma Saastopankki Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exel Composites and Oma Saastopankki
The main advantage of trading using opposite Exel Composites and Oma Saastopankki positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exel Composites position performs unexpectedly, Oma Saastopankki 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 Oma Saastopankki will offset losses from the drop in Oma Saastopankki's long position.| Exel Composites vs. Telefonaktiebolaget LM Ericsson | Exel Composites vs. SSAB AB ser | Exel Composites vs. SSAB AB ser | Exel Composites vs. Telia Company AB |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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