Correlation Between Oatly Group and WORK Medical
Can any of the company-specific risk be diversified away by investing in both Oatly Group and WORK Medical 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 WORK Medical 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 WORK Medical Technology, you can compare the effects of market volatilities on Oatly Group and WORK Medical 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 WORK Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oatly Group and WORK Medical.
Diversification Opportunities for Oatly Group and WORK Medical
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oatly and WORK is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Oatly Group AB and WORK Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WORK Medical Technology 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 WORK Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WORK Medical Technology has no effect on the direction of Oatly Group i.e., Oatly Group and WORK Medical go up and down completely randomly.
Pair Corralation between Oatly Group and WORK Medical
Given the investment horizon of 90 days Oatly Group AB is expected to under-perform the WORK Medical. But the stock apears to be less risky and, when comparing its historical volatility, Oatly Group AB is 2.0 times less risky than WORK Medical. The stock trades about -0.04 of its potential returns per unit of risk. The WORK Medical Technology is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 360.00 in WORK Medical Technology on September 14, 2024 and sell it today you would earn a total of 111.00 from holding WORK Medical Technology or generate 30.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 31.33% |
| Values | Daily Returns |
Oatly Group AB vs. WORK Medical Technology
Performance |
| Timeline |
| Oatly Group AB |
| WORK Medical Technology |
Oatly Group and WORK Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oatly Group and WORK Medical
The main advantage of trading using opposite Oatly Group and WORK Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oatly Group position performs unexpectedly, WORK Medical 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 WORK Medical will offset losses from the drop in WORK Medical's long position.| Oatly Group vs. Monster Beverage Corp | Oatly Group vs. Vita Coco | Oatly Group vs. PepsiCo | Oatly Group vs. The Coca Cola |
| WORK Medical vs. IPG Photonics | WORK Medical vs. GMS Inc | WORK Medical vs. Cementos Pacasmayo SAA | WORK Medical vs. Stepan Company |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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