Correlation Between OMX Stockholm and Traton SE
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By analyzing existing cross correlation between OMX Stockholm Mid and Traton SE, you can compare the effects of market volatilities on OMX Stockholm and Traton SE 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 OMX Stockholm with a short position of Traton SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and Traton SE.
Diversification Opportunities for OMX Stockholm and Traton SE
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between OMX and Traton is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and Traton SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Traton SE and OMX Stockholm 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 OMX Stockholm Mid are associated (or correlated) with Traton SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Traton SE has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and Traton SE go up and down completely randomly.
Pair Corralation between OMX Stockholm and Traton SE
Assuming the 90 days trading horizon OMX Stockholm is expected to generate 1.86 times less return on investment than Traton SE. But when comparing it to its historical volatility, OMX Stockholm Mid is 2.32 times less risky than Traton SE. It trades about 0.1 of its potential returns per unit of risk. Traton SE is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 23,283 in Traton SE on September 3, 2024 and sell it today you would earn a total of 9,917 from holding Traton SE or generate 42.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
OMX Stockholm Mid vs. Traton SE
Performance |
| Timeline |
OMX Stockholm and Traton SE Volatility Contrast
Predicted Return Density |
| Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
Traton SE
Pair trading matchups for Traton SE
Pair Trading with OMX Stockholm and Traton SE
The main advantage of trading using opposite OMX Stockholm and Traton SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, Traton SE 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 Traton SE will offset losses from the drop in Traton SE's long position.| OMX Stockholm vs. Investment AB Oresund | OMX Stockholm vs. MTI Investment SE | OMX Stockholm vs. Kinnevik Investment AB | OMX Stockholm vs. Axfood AB |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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