Correlation Between Telia Company and Sotkamo Silver
Can any of the company-specific risk be diversified away by investing in both Telia Company and Sotkamo Silver 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 Telia Company and Sotkamo Silver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telia Company AB and Sotkamo Silver AB, you can compare the effects of market volatilities on Telia Company and Sotkamo Silver 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 Telia Company with a short position of Sotkamo Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telia Company and Sotkamo Silver.
Diversification Opportunities for Telia Company and Sotkamo Silver
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telia and Sotkamo is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Telia Company AB and Sotkamo Silver AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sotkamo Silver AB and Telia Company 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 Telia Company AB are associated (or correlated) with Sotkamo Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sotkamo Silver AB has no effect on the direction of Telia Company i.e., Telia Company and Sotkamo Silver go up and down completely randomly.
Pair Corralation between Telia Company and Sotkamo Silver
Assuming the 90 days trading horizon Telia Company is expected to generate 2.49 times less return on investment than Sotkamo Silver. But when comparing it to its historical volatility, Telia Company AB is 4.23 times less risky than Sotkamo Silver. It trades about 0.03 of its potential returns per unit of risk. Sotkamo Silver AB is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 9.42 in Sotkamo Silver AB on August 25, 2024 and sell it today you would lose (0.08) from holding Sotkamo Silver AB or give up 0.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.48% |
| Values | Daily Returns |
Telia Company AB vs. Sotkamo Silver AB
Performance |
| Timeline |
| Telia Company |
| Sotkamo Silver AB |
Telia Company and Sotkamo Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telia Company and Sotkamo Silver
The main advantage of trading using opposite Telia Company and Sotkamo Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telia Company position performs unexpectedly, Sotkamo Silver 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 Sotkamo Silver will offset losses from the drop in Sotkamo Silver's long position.| Telia Company vs. Nordea Bank Abp | Telia Company vs. Sampo Oyj A | Telia Company vs. Fortum Oyj | Telia Company vs. Wartsila Oyj Abp |
| Sotkamo Silver vs. Outokumpu Oyj | Sotkamo Silver vs. Finnair Oyj | Sotkamo Silver vs. SSAB AB ser | Sotkamo Silver vs. Telia Company 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |