Correlation Between Musti Group and Harvia Oyj
Can any of the company-specific risk be diversified away by investing in both Musti Group and Harvia 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 Musti Group and Harvia Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Musti Group Oyj and Harvia Oyj, you can compare the effects of market volatilities on Musti Group and Harvia 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 Musti Group with a short position of Harvia Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Musti Group and Harvia Oyj.
Diversification Opportunities for Musti Group and Harvia Oyj
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Musti and Harvia is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Musti Group Oyj and Harvia Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvia Oyj and Musti Group 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 Musti Group Oyj are associated (or correlated) with Harvia Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvia Oyj has no effect on the direction of Musti Group i.e., Musti Group and Harvia Oyj go up and down completely randomly.
Pair Corralation between Musti Group and Harvia Oyj
Assuming the 90 days trading horizon Musti Group Oyj is expected to under-perform the Harvia Oyj. In addition to that, Musti Group is 1.26 times more volatile than Harvia Oyj. It trades about -0.19 of its total potential returns per unit of risk. Harvia Oyj is currently generating about -0.1 per unit of volatility. If you would invest 4,555 in Harvia Oyj on September 1, 2024 and sell it today you would lose (175.00) from holding Harvia Oyj or give up 3.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Musti Group Oyj vs. Harvia Oyj
Performance |
| Timeline |
| Musti Group Oyj |
| Harvia Oyj |
Musti Group and Harvia Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Musti Group and Harvia Oyj
The main advantage of trading using opposite Musti Group and Harvia Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Musti Group position performs unexpectedly, Harvia 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 Harvia Oyj will offset losses from the drop in Harvia Oyj's long position.| Musti Group vs. Harvia Oyj | Musti Group vs. Tokmanni Group Oyj | Musti Group vs. Kamux Suomi Oy | Musti Group vs. Revenio Group |
| Harvia Oyj vs. Qt Group Oyj | Harvia Oyj vs. Kamux Suomi Oy | Harvia Oyj vs. Sampo Oyj A | Harvia Oyj vs. Tokmanni Group Oyj |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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