Correlation Between Orion Oyj and Scanfil Oyj
Can any of the company-specific risk be diversified away by investing in both Orion Oyj and Scanfil Oyj 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 Orion Oyj and Scanfil Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orion Oyj B and Scanfil Oyj, you can compare the effects of market volatilities on Orion Oyj and Scanfil Oyj 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 Orion Oyj with a short position of Scanfil Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orion Oyj and Scanfil Oyj.
Diversification Opportunities for Orion Oyj and Scanfil Oyj
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Orion and Scanfil is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Orion Oyj B and Scanfil Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scanfil Oyj and Orion Oyj 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 Orion Oyj B are associated (or correlated) with Scanfil Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scanfil Oyj has no effect on the direction of Orion Oyj i.e., Orion Oyj and Scanfil Oyj go up and down completely randomly.
Pair Corralation between Orion Oyj and Scanfil Oyj
Assuming the 90 days trading horizon Orion Oyj B is expected to generate 1.04 times more return on investment than Scanfil Oyj. However, Orion Oyj is 1.04 times more volatile than Scanfil Oyj. It trades about 0.08 of its potential returns per unit of risk. Scanfil Oyj is currently generating about -0.16 per unit of risk. If you would invest 4,434 in Orion Oyj B on August 30, 2024 and sell it today you would earn a total of 103.00 from holding Orion Oyj B or generate 2.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orion Oyj B vs. Scanfil Oyj
Performance |
| Timeline |
| Orion Oyj B |
| Scanfil Oyj |
Orion Oyj and Scanfil Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orion Oyj and Scanfil Oyj
The main advantage of trading using opposite Orion Oyj and Scanfil Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orion Oyj position performs unexpectedly, Scanfil Oyj 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 Scanfil Oyj will offset losses from the drop in Scanfil Oyj's long position.| Orion Oyj vs. Qt Group Oyj | Orion Oyj vs. Harvia Oyj | Orion Oyj vs. Sampo Oyj A | Orion Oyj vs. Kamux Suomi Oy |
| Scanfil Oyj vs. Tokmanni Group Oyj | Scanfil Oyj vs. Kemira Oyj | Scanfil Oyj vs. Valmet Oyj | Scanfil Oyj vs. Etteplan Oyj |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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