Correlation Between OMX Stockholm and Africa Energy
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By analyzing existing cross correlation between OMX Stockholm Mid and Africa Energy Corp, you can compare the effects of market volatilities on OMX Stockholm and Africa Energy 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 Africa Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and Africa Energy.
Diversification Opportunities for OMX Stockholm and Africa Energy
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OMX and Africa is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and Africa Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Africa Energy Corp 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 Africa Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Africa Energy Corp has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and Africa Energy go up and down completely randomly.
Pair Corralation between OMX Stockholm and Africa Energy
Assuming the 90 days trading horizon OMX Stockholm Mid is expected to under-perform the Africa Energy. But the index apears to be less risky and, when comparing its historical volatility, OMX Stockholm Mid is 4.34 times less risky than Africa Energy. The index trades about -0.07 of its potential returns per unit of risk. The Africa Energy Corp is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Africa Energy Corp on September 1, 2024 and sell it today you would earn a total of 3.00 from holding Africa Energy Corp or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OMX Stockholm Mid vs. Africa Energy Corp
Performance |
| Timeline |
OMX Stockholm and Africa Energy Volatility Contrast
Predicted Return Density |
| Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
Africa Energy Corp
Pair trading matchups for Africa Energy
Pair Trading with OMX Stockholm and Africa Energy
The main advantage of trading using opposite OMX Stockholm and Africa Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, Africa Energy 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 Africa Energy will offset losses from the drop in Africa Energy's long position.| OMX Stockholm vs. Beowulf Mining PLC | OMX Stockholm vs. Swedbank AB | OMX Stockholm vs. Arion banki hf | OMX Stockholm vs. TradeDoubler AB |
| Africa Energy vs. Arctic Blue Beverages | Africa Energy vs. Scandinavian ChemoTech AB | Africa Energy vs. White Pearl Technology | Africa Energy vs. Beowulf Mining PLC |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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