Correlation Between MOL PLC and Repsol SA
Can any of the company-specific risk be diversified away by investing in both MOL PLC and Repsol SA 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 MOL PLC and Repsol SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOL PLC ADR and Repsol SA, you can compare the effects of market volatilities on MOL PLC and Repsol SA 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 MOL PLC with a short position of Repsol SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOL PLC and Repsol SA.
Diversification Opportunities for MOL PLC and Repsol SA
Excellent diversification
The 3 months correlation between MOL and Repsol is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding MOL PLC ADR and Repsol SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Repsol SA and MOL PLC 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 MOL PLC ADR are associated (or correlated) with Repsol SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Repsol SA has no effect on the direction of MOL PLC i.e., MOL PLC and Repsol SA go up and down completely randomly.
Pair Corralation between MOL PLC and Repsol SA
If you would invest 1,583 in Repsol SA on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Repsol SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
MOL PLC ADR vs. Repsol SA
Performance |
| Timeline |
| MOL PLC ADR |
| Repsol SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MOL PLC and Repsol SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOL PLC and Repsol SA
The main advantage of trading using opposite MOL PLC and Repsol SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOL PLC position performs unexpectedly, Repsol SA 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 Repsol SA will offset losses from the drop in Repsol SA's long position.| MOL PLC vs. Equinor ASA ADR | MOL PLC vs. TotalEnergies SE ADR | MOL PLC vs. Ecopetrol SA ADR | MOL PLC vs. National Fuel Gas |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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