Correlation Between Innofactor Oyj and Glaston Oyj
Can any of the company-specific risk be diversified away by investing in both Innofactor Oyj and Glaston 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 Innofactor Oyj and Glaston Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innofactor Oyj and Glaston Oyj Abp, you can compare the effects of market volatilities on Innofactor Oyj and Glaston 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 Innofactor Oyj with a short position of Glaston Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innofactor Oyj and Glaston Oyj.
Diversification Opportunities for Innofactor Oyj and Glaston Oyj
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Innofactor and Glaston is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Innofactor Oyj and Glaston Oyj Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glaston Oyj Abp and Innofactor Oyj 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 Innofactor Oyj are associated (or correlated) with Glaston Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glaston Oyj Abp has no effect on the direction of Innofactor Oyj i.e., Innofactor Oyj and Glaston Oyj go up and down completely randomly.
Pair Corralation between Innofactor Oyj and Glaston Oyj
Assuming the 90 days trading horizon Innofactor Oyj is expected to generate 3.02 times more return on investment than Glaston Oyj. However, Innofactor Oyj is 3.02 times more volatile than Glaston Oyj Abp. It trades about 0.07 of its potential returns per unit of risk. Glaston Oyj Abp is currently generating about -0.05 per unit of risk. If you would invest 129.00 in Innofactor Oyj on August 28, 2024 and sell it today you would earn a total of 40.00 from holding Innofactor Oyj or generate 31.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innofactor Oyj vs. Glaston Oyj Abp
Performance |
| Timeline |
| Innofactor Oyj |
| Glaston Oyj Abp |
Innofactor Oyj and Glaston Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innofactor Oyj and Glaston Oyj
The main advantage of trading using opposite Innofactor Oyj and Glaston Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innofactor Oyj position performs unexpectedly, Glaston 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 Glaston Oyj will offset losses from the drop in Glaston Oyj's long position.| Innofactor Oyj vs. Tecnotree Oyj | Innofactor Oyj vs. Solteq PLC | Innofactor Oyj vs. TietoEVRY Corp | Innofactor Oyj vs. Tokmanni Group Oyj |
| Glaston Oyj vs. Aktia Bank Abp | Glaston Oyj vs. Alandsbanken Abp B | Glaston Oyj vs. Alandsbanken Abp A | Glaston Oyj vs. Sampo Oyj A |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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