Correlation Between Feintool International and OC Oerlikon
Can any of the company-specific risk be diversified away by investing in both Feintool International and OC Oerlikon 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 Feintool International and OC Oerlikon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Feintool International Holding and OC Oerlikon Corp, you can compare the effects of market volatilities on Feintool International and OC Oerlikon 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 Feintool International with a short position of OC Oerlikon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Feintool International and OC Oerlikon.
Diversification Opportunities for Feintool International and OC Oerlikon
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Feintool and OERL is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Feintool International Holding and OC Oerlikon Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OC Oerlikon Corp and Feintool International 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 Feintool International Holding are associated (or correlated) with OC Oerlikon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OC Oerlikon Corp has no effect on the direction of Feintool International i.e., Feintool International and OC Oerlikon go up and down completely randomly.
Pair Corralation between Feintool International and OC Oerlikon
Assuming the 90 days trading horizon Feintool International Holding is expected to generate 1.04 times more return on investment than OC Oerlikon. However, Feintool International is 1.04 times more volatile than OC Oerlikon Corp. It trades about -0.06 of its potential returns per unit of risk. OC Oerlikon Corp is currently generating about -0.14 per unit of risk. If you would invest 1,625 in Feintool International Holding on September 3, 2024 and sell it today you would lose (50.00) from holding Feintool International Holding or give up 3.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Feintool International Holding vs. OC Oerlikon Corp
Performance |
| Timeline |
| Feintool International |
| OC Oerlikon Corp |
Feintool International and OC Oerlikon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Feintool International and OC Oerlikon
The main advantage of trading using opposite Feintool International and OC Oerlikon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Feintool International position performs unexpectedly, OC Oerlikon 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 OC Oerlikon will offset losses from the drop in OC Oerlikon's long position.| Feintool International vs. Rieter Holding AG | Feintool International vs. Autoneum Holding AG | Feintool International vs. Bucher Industries AG | Feintool International vs. Komax Holding AG |
| OC Oerlikon vs. Emmi AG | OC Oerlikon vs. EMS CHEMIE HOLDING AG | OC Oerlikon vs. Barry Callebaut AG | OC Oerlikon vs. VAT Group 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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