Correlation Between Raketech Group and Online Brands
Can any of the company-specific risk be diversified away by investing in both Raketech Group and Online Brands 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 Raketech Group and Online Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raketech Group Holding and Online Brands Nordic, you can compare the effects of market volatilities on Raketech Group and Online Brands 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 Raketech Group with a short position of Online Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raketech Group and Online Brands.
Diversification Opportunities for Raketech Group and Online Brands
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Raketech and Online is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Raketech Group Holding and Online Brands Nordic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Online Brands Nordic and Raketech 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 Raketech Group Holding are associated (or correlated) with Online Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Online Brands Nordic has no effect on the direction of Raketech Group i.e., Raketech Group and Online Brands go up and down completely randomly.
Pair Corralation between Raketech Group and Online Brands
Assuming the 90 days trading horizon Raketech Group Holding is expected to under-perform the Online Brands. In addition to that, Raketech Group is 1.22 times more volatile than Online Brands Nordic. It trades about -0.21 of its total potential returns per unit of risk. Online Brands Nordic is currently generating about -0.06 per unit of volatility. If you would invest 1,250 in Online Brands Nordic on September 3, 2024 and sell it today you would lose (165.00) from holding Online Brands Nordic or give up 13.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raketech Group Holding vs. Online Brands Nordic
Performance |
| Timeline |
| Raketech Group Holding |
| Online Brands Nordic |
Raketech Group and Online Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raketech Group and Online Brands
The main advantage of trading using opposite Raketech Group and Online Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raketech Group position performs unexpectedly, Online Brands 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 Online Brands will offset losses from the drop in Online Brands' long position.| Raketech Group vs. Catena Media plc | Raketech Group vs. Better Collective | Raketech Group vs. Betsson AB | Raketech Group vs. Kambi Group PLC |
| Online Brands vs. NetJobs Group AB | Online Brands vs. Mantex AB | Online Brands vs. Doxa AB | Online Brands vs. Clean Motion AB |
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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