Correlation Between Oatly Group and Naked Wines
Can any of the company-specific risk be diversified away by investing in both Oatly Group and Naked Wines 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 Naked Wines 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 Naked Wines plc, you can compare the effects of market volatilities on Oatly Group and Naked Wines 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 Naked Wines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oatly Group and Naked Wines.
Diversification Opportunities for Oatly Group and Naked Wines
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Oatly and Naked is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Oatly Group AB and Naked Wines plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naked Wines plc 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 Naked Wines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naked Wines plc has no effect on the direction of Oatly Group i.e., Oatly Group and Naked Wines go up and down completely randomly.
Pair Corralation between Oatly Group and Naked Wines
Given the investment horizon of 90 days Oatly Group AB is expected to generate 0.63 times more return on investment than Naked Wines. However, Oatly Group AB is 1.58 times less risky than Naked Wines. It trades about -0.11 of its potential returns per unit of risk. Naked Wines plc is currently generating about -0.22 per unit of risk. If you would invest 72.00 in Oatly Group AB on November 2, 2024 and sell it today you would lose (5.00) from holding Oatly Group AB or give up 6.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Oatly Group AB vs. Naked Wines plc
Performance |
| Timeline |
| Oatly Group AB |
| Naked Wines plc |
Oatly Group and Naked Wines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oatly Group and Naked Wines
The main advantage of trading using opposite Oatly Group and Naked Wines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oatly Group position performs unexpectedly, Naked Wines 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 Naked Wines will offset losses from the drop in Naked Wines' long position.| Oatly Group vs. Monster Beverage Corp | Oatly Group vs. Vita Coco | Oatly Group vs. PepsiCo | Oatly Group vs. The Coca Cola |
| Naked Wines vs. Pernod Ricard SA | Naked Wines vs. Naked Wines plc | Naked Wines vs. Crimson Wine | Naked Wines vs. Brown Forman |
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.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |