Correlation Between Oatly Group and Indivior PLC
Can any of the company-specific risk be diversified away by investing in both Oatly Group and Indivior PLC 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 Oatly Group and Indivior PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oatly Group AB and Indivior PLC Ordinary, you can compare the effects of market volatilities on Oatly Group and Indivior PLC 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 Oatly Group with a short position of Indivior PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oatly Group and Indivior PLC.
Diversification Opportunities for Oatly Group and Indivior PLC
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Oatly and Indivior is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Oatly Group AB and Indivior PLC Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indivior PLC Ordinary and Oatly Group 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 Oatly Group AB are associated (or correlated) with Indivior PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indivior PLC Ordinary has no effect on the direction of Oatly Group i.e., Oatly Group and Indivior PLC go up and down completely randomly.
Pair Corralation between Oatly Group and Indivior PLC
Given the investment horizon of 90 days Oatly Group AB is expected to under-perform the Indivior PLC. In addition to that, Oatly Group is 1.45 times more volatile than Indivior PLC Ordinary. It trades about -0.04 of its total potential returns per unit of risk. Indivior PLC Ordinary is currently generating about 0.24 per unit of volatility. If you would invest 892.00 in Indivior PLC Ordinary on August 28, 2024 and sell it today you would earn a total of 197.00 from holding Indivior PLC Ordinary or generate 22.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oatly Group AB vs. Indivior PLC Ordinary
Performance |
| Timeline |
| Oatly Group AB |
| Indivior PLC Ordinary |
Oatly Group and Indivior PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oatly Group and Indivior PLC
The main advantage of trading using opposite Oatly Group and Indivior PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oatly Group position performs unexpectedly, Indivior PLC 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 Indivior PLC will offset losses from the drop in Indivior PLC's long position.| Oatly Group vs. Bellring Brands LLC | Oatly Group vs. Ingredion Incorporated | Oatly Group vs. Nomad Foods | Oatly Group vs. Simply Good Foods |
| Indivior PLC vs. Burlington Stores | Indivior PLC vs. GameStop Corp | Indivior PLC vs. Corsair Gaming | Indivior PLC vs. Skechers USA |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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