Correlation Between Oncimmune Holdings and Aberforth Smaller
Can any of the company-specific risk be diversified away by investing in both Oncimmune Holdings and Aberforth Smaller 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 Oncimmune Holdings and Aberforth Smaller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oncimmune Holdings plc and Aberforth Smaller Companies, you can compare the effects of market volatilities on Oncimmune Holdings and Aberforth Smaller 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 Oncimmune Holdings with a short position of Aberforth Smaller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oncimmune Holdings and Aberforth Smaller.
Diversification Opportunities for Oncimmune Holdings and Aberforth Smaller
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Oncimmune and Aberforth is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Oncimmune Holdings plc and Aberforth Smaller Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberforth Smaller and Oncimmune 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 Oncimmune Holdings plc are associated (or correlated) with Aberforth Smaller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberforth Smaller has no effect on the direction of Oncimmune Holdings i.e., Oncimmune Holdings and Aberforth Smaller go up and down completely randomly.
Pair Corralation between Oncimmune Holdings and Aberforth Smaller
Assuming the 90 days trading horizon Oncimmune Holdings plc is expected to under-perform the Aberforth Smaller. In addition to that, Oncimmune Holdings is 4.34 times more volatile than Aberforth Smaller Companies. It trades about -0.06 of its total potential returns per unit of risk. Aberforth Smaller Companies is currently generating about -0.13 per unit of volatility. If you would invest 158,400 in Aberforth Smaller Companies on August 31, 2024 and sell it today you would lose (14,000) from holding Aberforth Smaller Companies or give up 8.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Oncimmune Holdings plc vs. Aberforth Smaller Companies
Performance |
| Timeline |
| Oncimmune Holdings plc |
| Aberforth Smaller |
Oncimmune Holdings and Aberforth Smaller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oncimmune Holdings and Aberforth Smaller
The main advantage of trading using opposite Oncimmune Holdings and Aberforth Smaller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oncimmune Holdings position performs unexpectedly, Aberforth Smaller 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 Aberforth Smaller will offset losses from the drop in Aberforth Smaller's long position.| Oncimmune Holdings vs. Cairo Communication SpA | Oncimmune Holdings vs. Alfa Financial Software | Oncimmune Holdings vs. United Airlines Holdings | Oncimmune Holdings vs. Gamma Communications PLC |
| Aberforth Smaller vs. Wheaton Precious Metals | Aberforth Smaller vs. CompuGroup Medical AG | Aberforth Smaller vs. Futura Medical | Aberforth Smaller 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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