Correlation Between Ferrari NV and Oasmia Pharmaceutical
Can any of the company-specific risk be diversified away by investing in both Ferrari NV and Oasmia Pharmaceutical 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 Ferrari NV and Oasmia Pharmaceutical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ferrari NV and Oasmia Pharmaceutical AB, you can compare the effects of market volatilities on Ferrari NV and Oasmia Pharmaceutical 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 Ferrari NV with a short position of Oasmia Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferrari NV and Oasmia Pharmaceutical.
Diversification Opportunities for Ferrari NV and Oasmia Pharmaceutical
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ferrari and Oasmia is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ferrari NV and Oasmia Pharmaceutical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oasmia Pharmaceutical and Ferrari NV 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 Ferrari NV are associated (or correlated) with Oasmia Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oasmia Pharmaceutical has no effect on the direction of Ferrari NV i.e., Ferrari NV and Oasmia Pharmaceutical go up and down completely randomly.
Pair Corralation between Ferrari NV and Oasmia Pharmaceutical
Given the investment horizon of 90 days Ferrari NV is expected to generate 0.06 times more return on investment than Oasmia Pharmaceutical. However, Ferrari NV is 16.37 times less risky than Oasmia Pharmaceutical. It trades about 0.1 of its potential returns per unit of risk. Oasmia Pharmaceutical AB is currently generating about 0.0 per unit of risk. If you would invest 21,711 in Ferrari NV on August 28, 2024 and sell it today you would earn a total of 21,813 from holding Ferrari NV or generate 100.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 8.69% |
| Values | Daily Returns |
Ferrari NV vs. Oasmia Pharmaceutical AB
Performance |
| Timeline |
| Ferrari NV |
| Oasmia Pharmaceutical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ferrari NV and Oasmia Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ferrari NV and Oasmia Pharmaceutical
The main advantage of trading using opposite Ferrari NV and Oasmia Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ferrari NV position performs unexpectedly, Oasmia Pharmaceutical 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 Oasmia Pharmaceutical will offset losses from the drop in Oasmia Pharmaceutical's long position.| Ferrari NV vs. Nio Class A | Ferrari NV vs. Lucid Group | Ferrari NV vs. Tesla Inc | Ferrari NV vs. Mullen Automotive |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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