Correlation Between Corning Incorporated and Obducat AB
Can any of the company-specific risk be diversified away by investing in both Corning Incorporated and Obducat AB 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 Corning Incorporated and Obducat AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corning Incorporated and Obducat AB, you can compare the effects of market volatilities on Corning Incorporated and Obducat AB 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 Corning Incorporated with a short position of Obducat AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corning Incorporated and Obducat AB.
Diversification Opportunities for Corning Incorporated and Obducat AB
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Corning and Obducat is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Corning Incorporated and Obducat AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Obducat AB and Corning Incorporated 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 Corning Incorporated are associated (or correlated) with Obducat AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Obducat AB has no effect on the direction of Corning Incorporated i.e., Corning Incorporated and Obducat AB go up and down completely randomly.
Pair Corralation between Corning Incorporated and Obducat AB
Assuming the 90 days horizon Corning Incorporated is expected to generate 3.85 times less return on investment than Obducat AB. But when comparing it to its historical volatility, Corning Incorporated is 9.32 times less risky than Obducat AB. It trades about 0.15 of its potential returns per unit of risk. Obducat AB is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 10.00 in Obducat AB on August 30, 2024 and sell it today you would lose (3.00) from holding Obducat AB or give up 30.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corning Incorporated vs. Obducat AB
Performance |
| Timeline |
| Corning Incorporated |
| Obducat AB |
Corning Incorporated and Obducat AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corning Incorporated and Obducat AB
The main advantage of trading using opposite Corning Incorporated and Obducat AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corning Incorporated position performs unexpectedly, Obducat AB 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 Obducat AB will offset losses from the drop in Obducat AB's long position.| Corning Incorporated vs. QBE Insurance Group | Corning Incorporated vs. CHINA TONTINE WINES | Corning Incorporated vs. Commonwealth Bank of | Corning Incorporated vs. COMMERCIAL VEHICLE |
| Obducat AB vs. Dairy Farm International | Obducat AB vs. Nufarm Limited | Obducat AB vs. Sumitomo Mitsui Construction | Obducat AB vs. MagnaChip Semiconductor Corp |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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