Correlation Between OtelloASA and CapitaLand Investment
Can any of the company-specific risk be diversified away by investing in both OtelloASA and CapitaLand Investment 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 OtelloASA and CapitaLand Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Otello ASA and CapitaLand Investment Limited, you can compare the effects of market volatilities on OtelloASA and CapitaLand Investment 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 OtelloASA with a short position of CapitaLand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of OtelloASA and CapitaLand Investment.
Diversification Opportunities for OtelloASA and CapitaLand Investment
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OtelloASA and CapitaLand is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Otello ASA and CapitaLand Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Investment and OtelloASA 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 Otello ASA are associated (or correlated) with CapitaLand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Investment has no effect on the direction of OtelloASA i.e., OtelloASA and CapitaLand Investment go up and down completely randomly.
Pair Corralation between OtelloASA and CapitaLand Investment
Assuming the 90 days horizon Otello ASA is expected to generate 1.49 times more return on investment than CapitaLand Investment. However, OtelloASA is 1.49 times more volatile than CapitaLand Investment Limited. It trades about 0.0 of its potential returns per unit of risk. CapitaLand Investment Limited is currently generating about -0.01 per unit of risk. If you would invest 79.00 in Otello ASA on September 4, 2024 and sell it today you would lose (13.00) from holding Otello ASA or give up 16.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Otello ASA vs. CapitaLand Investment Limited
Performance |
| Timeline |
| Otello ASA |
| CapitaLand Investment |
OtelloASA and CapitaLand Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OtelloASA and CapitaLand Investment
The main advantage of trading using opposite OtelloASA and CapitaLand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OtelloASA position performs unexpectedly, CapitaLand Investment 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 CapitaLand Investment will offset losses from the drop in CapitaLand Investment's long position.| OtelloASA vs. Superior Plus Corp | OtelloASA vs. NMI Holdings | OtelloASA vs. Origin Agritech | OtelloASA vs. SIVERS SEMICONDUCTORS AB |
| CapitaLand Investment vs. DXC Technology Co | CapitaLand Investment vs. Vishay Intertechnology | CapitaLand Investment vs. JSC Halyk bank | CapitaLand Investment vs. Micron Technology |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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