Correlation Between Kamux Suomi and Verkkokauppa Oyj
Can any of the company-specific risk be diversified away by investing in both Kamux Suomi and Verkkokauppa 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 Kamux Suomi and Verkkokauppa Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kamux Suomi Oy and Verkkokauppa Oyj, you can compare the effects of market volatilities on Kamux Suomi and Verkkokauppa 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 Kamux Suomi with a short position of Verkkokauppa Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kamux Suomi and Verkkokauppa Oyj.
Diversification Opportunities for Kamux Suomi and Verkkokauppa Oyj
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kamux and Verkkokauppa is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kamux Suomi Oy and Verkkokauppa Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verkkokauppa Oyj and Kamux Suomi 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 Kamux Suomi Oy are associated (or correlated) with Verkkokauppa Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verkkokauppa Oyj has no effect on the direction of Kamux Suomi i.e., Kamux Suomi and Verkkokauppa Oyj go up and down completely randomly.
Pair Corralation between Kamux Suomi and Verkkokauppa Oyj
Assuming the 90 days trading horizon Kamux Suomi Oy is expected to under-perform the Verkkokauppa Oyj. But the stock apears to be less risky and, when comparing its historical volatility, Kamux Suomi Oy is 2.1 times less risky than Verkkokauppa Oyj. The stock trades about -0.29 of its potential returns per unit of risk. The Verkkokauppa Oyj is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 137.00 in Verkkokauppa Oyj on November 28, 2024 and sell it today you would earn a total of 86.00 from holding Verkkokauppa Oyj or generate 62.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kamux Suomi Oy vs. Verkkokauppa Oyj
Performance |
| Timeline |
| Kamux Suomi Oy |
| Verkkokauppa Oyj |
Kamux Suomi and Verkkokauppa Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kamux Suomi and Verkkokauppa Oyj
The main advantage of trading using opposite Kamux Suomi and Verkkokauppa Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kamux Suomi position performs unexpectedly, Verkkokauppa 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 Verkkokauppa Oyj will offset losses from the drop in Verkkokauppa Oyj's long position.| Kamux Suomi vs. Harvia Oyj | Kamux Suomi vs. Qt Group Oyj | Kamux Suomi vs. Tokmanni Group Oyj | Kamux Suomi vs. Sampo Oyj A |
| Verkkokauppa Oyj vs. Tokmanni Group Oyj | Verkkokauppa Oyj vs. Harvia Oyj | Verkkokauppa Oyj vs. Sampo Oyj A | Verkkokauppa Oyj vs. Kamux Suomi Oy |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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