Correlation Between Sampo Oyj and Asuntosalkku Oyj
Can any of the company-specific risk be diversified away by investing in both Sampo Oyj and Asuntosalkku 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 Sampo Oyj and Asuntosalkku Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sampo Oyj A and Asuntosalkku Oyj, you can compare the effects of market volatilities on Sampo Oyj and Asuntosalkku 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 Sampo Oyj with a short position of Asuntosalkku Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sampo Oyj and Asuntosalkku Oyj.
Diversification Opportunities for Sampo Oyj and Asuntosalkku Oyj
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sampo and Asuntosalkku is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Sampo Oyj A and Asuntosalkku Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asuntosalkku Oyj and Sampo Oyj 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 Sampo Oyj A are associated (or correlated) with Asuntosalkku Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asuntosalkku Oyj has no effect on the direction of Sampo Oyj i.e., Sampo Oyj and Asuntosalkku Oyj go up and down completely randomly.
Pair Corralation between Sampo Oyj and Asuntosalkku Oyj
Assuming the 90 days trading horizon Sampo Oyj A is expected to under-perform the Asuntosalkku Oyj. But the stock apears to be less risky and, when comparing its historical volatility, Sampo Oyj A is 1.83 times less risky than Asuntosalkku Oyj. The stock trades about -0.13 of its potential returns per unit of risk. The Asuntosalkku Oyj is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 7,900 in Asuntosalkku Oyj on August 27, 2024 and sell it today you would lose (150.00) from holding Asuntosalkku Oyj or give up 1.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sampo Oyj A vs. Asuntosalkku Oyj
Performance |
| Timeline |
| Sampo Oyj A |
| Asuntosalkku Oyj |
Sampo Oyj and Asuntosalkku Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sampo Oyj and Asuntosalkku Oyj
The main advantage of trading using opposite Sampo Oyj and Asuntosalkku Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sampo Oyj position performs unexpectedly, Asuntosalkku 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 Asuntosalkku Oyj will offset losses from the drop in Asuntosalkku Oyj's long position.| Sampo Oyj vs. Nordea Bank Abp | Sampo Oyj vs. Fortum Oyj | Sampo Oyj vs. UPM Kymmene Oyj | Sampo Oyj vs. Neste Oil Oyj |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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