Correlation Between Exel Composites and Vaisala Oyj
Can any of the company-specific risk be diversified away by investing in both Exel Composites and Vaisala 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 Exel Composites and Vaisala Oyj 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 Vaisala Oyj A, you can compare the effects of market volatilities on Exel Composites and Vaisala 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 Exel Composites with a short position of Vaisala Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exel Composites and Vaisala Oyj.
Diversification Opportunities for Exel Composites and Vaisala Oyj
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Exel and Vaisala is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Exel Composites Oyj and Vaisala Oyj A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vaisala Oyj A 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 Vaisala Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vaisala Oyj A has no effect on the direction of Exel Composites i.e., Exel Composites and Vaisala Oyj go up and down completely randomly.
Pair Corralation between Exel Composites and Vaisala Oyj
Assuming the 90 days trading horizon Exel Composites Oyj is expected to under-perform the Vaisala Oyj. In addition to that, Exel Composites is 1.41 times more volatile than Vaisala Oyj A. It trades about -0.45 of its total potential returns per unit of risk. Vaisala Oyj A is currently generating about 0.08 per unit of volatility. If you would invest 4,620 in Vaisala Oyj A on August 27, 2024 and sell it today you would earn a total of 130.00 from holding Vaisala Oyj A or generate 2.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exel Composites Oyj vs. Vaisala Oyj A
Performance |
| Timeline |
| Exel Composites Oyj |
| Vaisala Oyj A |
Exel Composites and Vaisala Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exel Composites and Vaisala Oyj
The main advantage of trading using opposite Exel Composites and Vaisala Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exel Composites position performs unexpectedly, Vaisala 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 Vaisala Oyj will offset losses from the drop in Vaisala Oyj's long position.| Exel Composites vs. Aktia Bank Abp | Exel Composites vs. Alandsbanken Abp B | Exel Composites vs. Alandsbanken Abp A | Exel Composites vs. Sampo Oyj A |
| Vaisala Oyj vs. CapMan Oyj B | Vaisala Oyj vs. HKFoods Oyj A | Vaisala Oyj vs. KONE Oyj | Vaisala Oyj vs. Exel Composites 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |