Correlation Between Om Holdings and Tesco PLC
Can any of the company-specific risk be diversified away by investing in both Om Holdings and Tesco PLC 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 Om Holdings and Tesco PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Om Holdings International and Tesco PLC, you can compare the effects of market volatilities on Om Holdings and Tesco PLC 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 Om Holdings with a short position of Tesco PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Om Holdings and Tesco PLC.
Diversification Opportunities for Om Holdings and Tesco PLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OMHI and Tesco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Om Holdings International and Tesco PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tesco PLC and Om Holdings 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 Om Holdings International are associated (or correlated) with Tesco PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tesco PLC has no effect on the direction of Om Holdings i.e., Om Holdings and Tesco PLC go up and down completely randomly.
Pair Corralation between Om Holdings and Tesco PLC
If you would invest 0.02 in Om Holdings International on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Om Holdings International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Om Holdings International vs. Tesco PLC
Performance |
| Timeline |
| Om Holdings International |
| Tesco PLC |
Om Holdings and Tesco PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Om Holdings and Tesco PLC
The main advantage of trading using opposite Om Holdings and Tesco PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Om Holdings position performs unexpectedly, Tesco PLC 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 Tesco PLC will offset losses from the drop in Tesco PLC's long position.| Om Holdings vs. Tesco PLC | Om Holdings vs. Tesco PLC | Om Holdings vs. Ocado Group PLC | Om Holdings vs. Dairy Farm International |
| Tesco PLC vs. Ocado Group PLC | Tesco PLC vs. Dairy Farm International | Tesco PLC vs. Woolworths Group Limited | Tesco PLC vs. Kesko Oyj ADR |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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