Correlation Between Soditech and Onlineformapro
Can any of the company-specific risk be diversified away by investing in both Soditech and Onlineformapro 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 Soditech and Onlineformapro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Soditech SA and Onlineformapro SA, you can compare the effects of market volatilities on Soditech and Onlineformapro 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 Soditech with a short position of Onlineformapro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Soditech and Onlineformapro.
Diversification Opportunities for Soditech and Onlineformapro
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Soditech and Onlineformapro is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Soditech SA and Onlineformapro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onlineformapro SA and Soditech 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 Soditech SA are associated (or correlated) with Onlineformapro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onlineformapro SA has no effect on the direction of Soditech i.e., Soditech and Onlineformapro go up and down completely randomly.
Pair Corralation between Soditech and Onlineformapro
Assuming the 90 days trading horizon Soditech SA is expected to generate 0.07 times more return on investment than Onlineformapro. However, Soditech SA is 14.43 times less risky than Onlineformapro. It trades about -0.21 of its potential returns per unit of risk. Onlineformapro SA is currently generating about -0.15 per unit of risk. If you would invest 127.00 in Soditech SA on September 13, 2024 and sell it today you would lose (2.00) from holding Soditech SA or give up 1.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Soditech SA vs. Onlineformapro SA
Performance |
| Timeline |
| Soditech SA |
| Onlineformapro SA |
Soditech and Onlineformapro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Soditech and Onlineformapro
The main advantage of trading using opposite Soditech and Onlineformapro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Soditech position performs unexpectedly, Onlineformapro 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 Onlineformapro will offset losses from the drop in Onlineformapro's long position.The idea behind Soditech SA and Onlineformapro SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Onlineformapro vs. Txcom SA | Onlineformapro vs. Poujoulat SA | Onlineformapro vs. Vente Unique | Onlineformapro vs. Moulinvest |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |