Correlation Between Neste Oyj and PSI Software

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Neste Oyj and PSI Software 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 Neste Oyj and PSI Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neste Oyj and PSI Software AG, you can compare the effects of market volatilities on Neste Oyj and PSI Software 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 Neste Oyj with a short position of PSI Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neste Oyj and PSI Software.

Diversification Opportunities for Neste Oyj and PSI Software

-0.09
  Correlation Coefficient

Good diversification

The 3 months correlation between Neste and PSI is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Neste Oyj and PSI Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PSI Software AG and Neste 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 Neste Oyj are associated (or correlated) with PSI Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PSI Software AG has no effect on the direction of Neste Oyj i.e., Neste Oyj and PSI Software go up and down completely randomly.

Pair Corralation between Neste Oyj and PSI Software

Assuming the 90 days horizon Neste Oyj is expected to generate 3.03 times more return on investment than PSI Software. However, Neste Oyj is 3.03 times more volatile than PSI Software AG. It trades about 0.07 of its potential returns per unit of risk. PSI Software AG is currently generating about 0.03 per unit of risk. If you would invest  1,401  in Neste Oyj on September 4, 2024 and sell it today you would earn a total of  48.00  from holding Neste Oyj or generate 3.43% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Neste Oyj  vs.  PSI Software AG

 Performance 
       Timeline  
Neste Oyj 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Neste Oyj has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
PSI Software AG 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in PSI Software AG are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, PSI Software may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Neste Oyj and PSI Software Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Neste Oyj and PSI Software

The main advantage of trading using opposite Neste Oyj and PSI Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neste Oyj position performs unexpectedly, PSI Software 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 PSI Software will offset losses from the drop in PSI Software's long position.
Neste Oyj vs. Marathon Petroleum Corp
Neste Oyj vs. ENEOS Holdings
Neste Oyj vs. PTT OILRETBUS FOR BA10
The idea behind Neste Oyj and PSI Software AG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
PSI Software vs. Rocket Internet SE
PSI Software vs. Superior Plus Corp
PSI Software vs. NMI Holdings
PSI Software vs. Origin Agritech
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.

Other Complementary Tools

Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
CEOs Directory
Screen CEOs from public companies around the world
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY