Correlation Between PunaMusta Media and Siili Solutions
Can any of the company-specific risk be diversified away by investing in both PunaMusta Media and Siili Solutions 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 PunaMusta Media and Siili Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PunaMusta Media Oyj and Siili Solutions Oyj, you can compare the effects of market volatilities on PunaMusta Media and Siili Solutions 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 PunaMusta Media with a short position of Siili Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of PunaMusta Media and Siili Solutions.
Diversification Opportunities for PunaMusta Media and Siili Solutions
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PunaMusta and Siili is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding PunaMusta Media Oyj and Siili Solutions Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siili Solutions Oyj and PunaMusta Media 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 PunaMusta Media Oyj are associated (or correlated) with Siili Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siili Solutions Oyj has no effect on the direction of PunaMusta Media i.e., PunaMusta Media and Siili Solutions go up and down completely randomly.
Pair Corralation between PunaMusta Media and Siili Solutions
Assuming the 90 days trading horizon PunaMusta Media Oyj is expected to under-perform the Siili Solutions. But the stock apears to be less risky and, when comparing its historical volatility, PunaMusta Media Oyj is 2.81 times less risky than Siili Solutions. The stock trades about -0.58 of its potential returns per unit of risk. The Siili Solutions Oyj is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 618.00 in Siili Solutions Oyj on September 3, 2024 and sell it today you would lose (22.00) from holding Siili Solutions Oyj or give up 3.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 14.29% |
| Values | Daily Returns |
PunaMusta Media Oyj vs. Siili Solutions Oyj
Performance |
| Timeline |
| PunaMusta Media Oyj |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Siili Solutions Oyj |
PunaMusta Media and Siili Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PunaMusta Media and Siili Solutions
The main advantage of trading using opposite PunaMusta Media and Siili Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PunaMusta Media position performs unexpectedly, Siili Solutions 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 Siili Solutions will offset losses from the drop in Siili Solutions' long position.| PunaMusta Media vs. Raute Oyj | PunaMusta Media vs. Suominen Oyj | PunaMusta Media vs. Elecster Oyj A | PunaMusta Media vs. Siili Solutions Oyj |
| Siili Solutions vs. Qt Group Oyj | Siili Solutions vs. Revenio Group | Siili Solutions vs. Kamux Suomi Oy | Siili Solutions vs. Harvia Oyj |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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