Correlation Between NYSE Composite and Oatly Group
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Oatly Group 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 NYSE Composite and Oatly Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Oatly Group AB, you can compare the effects of market volatilities on NYSE Composite and Oatly Group 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 NYSE Composite with a short position of Oatly Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Oatly Group.
Diversification Opportunities for NYSE Composite and Oatly Group
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between NYSE and Oatly is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Oatly Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oatly Group AB and NYSE Composite 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 NYSE Composite are associated (or correlated) with Oatly Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oatly Group AB has no effect on the direction of NYSE Composite i.e., NYSE Composite and Oatly Group go up and down completely randomly.
Pair Corralation between NYSE Composite and Oatly Group
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.16 times more return on investment than Oatly Group. However, NYSE Composite is 6.38 times less risky than Oatly Group. It trades about 0.09 of its potential returns per unit of risk. Oatly Group AB is currently generating about -0.04 per unit of risk. If you would invest 1,901,742 in NYSE Composite on November 2, 2024 and sell it today you would earn a total of 114,880 from holding NYSE Composite or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Oatly Group AB
Performance |
| Timeline |
NYSE Composite and Oatly Group Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Oatly Group AB
Pair trading matchups for Oatly Group
Pair Trading with NYSE Composite and Oatly Group
The main advantage of trading using opposite NYSE Composite and Oatly Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Oatly Group 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 Oatly Group will offset losses from the drop in Oatly Group's long position.| NYSE Composite vs. Western Copper and | NYSE Composite vs. Chemours Co | NYSE Composite vs. IPG Photonics | NYSE Composite vs. Morgan Advanced Materials |
| Oatly Group vs. Monster Beverage Corp | Oatly Group vs. Vita Coco | Oatly Group vs. PepsiCo | Oatly Group vs. The Coca Cola |
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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