Correlation Between Jutal Offshore and Finnair Oyj
Can any of the company-specific risk be diversified away by investing in both Jutal Offshore and Finnair 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 Jutal Offshore and Finnair Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jutal Offshore Oil and Finnair Oyj, you can compare the effects of market volatilities on Jutal Offshore and Finnair 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 Jutal Offshore with a short position of Finnair Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jutal Offshore and Finnair Oyj.
Diversification Opportunities for Jutal Offshore and Finnair Oyj
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jutal and Finnair is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Jutal Offshore Oil and Finnair Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finnair Oyj and Jutal Offshore 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 Jutal Offshore Oil are associated (or correlated) with Finnair Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finnair Oyj has no effect on the direction of Jutal Offshore i.e., Jutal Offshore and Finnair Oyj go up and down completely randomly.
Pair Corralation between Jutal Offshore and Finnair Oyj
Assuming the 90 days horizon Jutal Offshore is expected to generate 6.75 times less return on investment than Finnair Oyj. But when comparing it to its historical volatility, Jutal Offshore Oil is 6.02 times less risky than Finnair Oyj. It trades about 0.04 of its potential returns per unit of risk. Finnair Oyj is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 200.00 in Finnair Oyj on November 3, 2024 and sell it today you would earn a total of 50.00 from holding Finnair Oyj or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jutal Offshore Oil vs. Finnair Oyj
Performance |
| Timeline |
| Jutal Offshore Oil |
| Finnair Oyj |
Jutal Offshore and Finnair Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jutal Offshore and Finnair Oyj
The main advantage of trading using opposite Jutal Offshore and Finnair Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jutal Offshore position performs unexpectedly, Finnair 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 Finnair Oyj will offset losses from the drop in Finnair Oyj's long position.| Jutal Offshore vs. Philip Morris International | Jutal Offshore vs. Ispire Technology Common | Jutal Offshore vs. CVR Partners LP | Jutal Offshore vs. RLX Technology |
| Finnair Oyj vs. easyJet plc | Finnair Oyj vs. Norse Atlantic ASA | Finnair Oyj vs. Air New Zealand | Finnair Oyj vs. Air China Limited |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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