Correlation Between Platinum Investment and Fiskars Oyj
Can any of the company-specific risk be diversified away by investing in both Platinum Investment and Fiskars 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 Platinum Investment and Fiskars Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Investment Management and Fiskars Oyj Abp, you can compare the effects of market volatilities on Platinum Investment and Fiskars 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 Platinum Investment with a short position of Fiskars Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Investment and Fiskars Oyj.
Diversification Opportunities for Platinum Investment and Fiskars Oyj
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Platinum and Fiskars is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Investment Management and Fiskars Oyj Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiskars Oyj Abp and Platinum Investment 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 Platinum Investment Management are associated (or correlated) with Fiskars Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiskars Oyj Abp has no effect on the direction of Platinum Investment i.e., Platinum Investment and Fiskars Oyj go up and down completely randomly.
Pair Corralation between Platinum Investment and Fiskars Oyj
Assuming the 90 days horizon Platinum Investment Management is expected to generate 1.52 times more return on investment than Fiskars Oyj. However, Platinum Investment is 1.52 times more volatile than Fiskars Oyj Abp. It trades about 0.12 of its potential returns per unit of risk. Fiskars Oyj Abp is currently generating about -0.07 per unit of risk. If you would invest 40.00 in Platinum Investment Management on October 25, 2024 and sell it today you would earn a total of 2.00 from holding Platinum Investment Management or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Platinum Investment Management vs. Fiskars Oyj Abp
Performance |
| Timeline |
| Platinum Investment |
| Fiskars Oyj Abp |
Platinum Investment and Fiskars Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Investment and Fiskars Oyj
The main advantage of trading using opposite Platinum Investment and Fiskars Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Investment position performs unexpectedly, Fiskars 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 Fiskars Oyj will offset losses from the drop in Fiskars Oyj's long position.| Platinum Investment vs. SILICON LABORATOR | Platinum Investment vs. Siamgas And Petrochemicals | Platinum Investment vs. AIR PRODCHEMICALS | Platinum Investment vs. Cars Inc |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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