Correlation Between Tecnotree Oyj and Nokia Oyj
Can any of the company-specific risk be diversified away by investing in both Tecnotree Oyj and Nokia 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 Tecnotree Oyj and Nokia Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tecnotree Oyj and Nokia Oyj, you can compare the effects of market volatilities on Tecnotree Oyj and Nokia 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 Tecnotree Oyj with a short position of Nokia Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tecnotree Oyj and Nokia Oyj.
Diversification Opportunities for Tecnotree Oyj and Nokia Oyj
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tecnotree and Nokia is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Tecnotree Oyj and Nokia Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nokia Oyj and Tecnotree 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 Tecnotree Oyj are associated (or correlated) with Nokia Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nokia Oyj has no effect on the direction of Tecnotree Oyj i.e., Tecnotree Oyj and Nokia Oyj go up and down completely randomly.
Pair Corralation between Tecnotree Oyj and Nokia Oyj
Assuming the 90 days trading horizon Tecnotree Oyj is expected to under-perform the Nokia Oyj. In addition to that, Tecnotree Oyj is 1.7 times more volatile than Nokia Oyj. It trades about -0.44 of its total potential returns per unit of risk. Nokia Oyj is currently generating about -0.29 per unit of volatility. If you would invest 438.00 in Nokia Oyj on September 2, 2024 and sell it today you would lose (40.00) from holding Nokia Oyj or give up 9.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tecnotree Oyj vs. Nokia Oyj
Performance |
| Timeline |
| Tecnotree Oyj |
| Nokia Oyj |
Tecnotree Oyj and Nokia Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tecnotree Oyj and Nokia Oyj
The main advantage of trading using opposite Tecnotree Oyj and Nokia Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tecnotree Oyj position performs unexpectedly, Nokia 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 Nokia Oyj will offset losses from the drop in Nokia Oyj's long position.| Tecnotree Oyj vs. Harvia Oyj | Tecnotree Oyj vs. Qt Group Oyj | Tecnotree Oyj vs. Kamux Suomi Oy | Tecnotree Oyj vs. Tokmanni Group Oyj |
| Nokia Oyj vs. Fortum Oyj | Nokia Oyj vs. Nordea Bank Abp | Nokia Oyj vs. Sampo Oyj A | Nokia Oyj vs. Neste Oil Oyj |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |