Correlation Between Tecnotree Oyj and Optomed PLC
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By analyzing existing cross correlation between Tecnotree Oyj and Optomed PLC, you can compare the effects of market volatilities on Tecnotree Oyj and Optomed PLC 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 Optomed PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tecnotree Oyj and Optomed PLC.
Diversification Opportunities for Tecnotree Oyj and Optomed PLC
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tecnotree and Optomed is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Tecnotree Oyj and Optomed PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Optomed PLC 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 Optomed PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Optomed PLC has no effect on the direction of Tecnotree Oyj i.e., Tecnotree Oyj and Optomed PLC go up and down completely randomly.
Pair Corralation between Tecnotree Oyj and Optomed PLC
Assuming the 90 days trading horizon Tecnotree Oyj is expected to under-perform the Optomed PLC. But the stock apears to be less risky and, when comparing its historical volatility, Tecnotree Oyj is 1.2 times less risky than Optomed PLC. The stock trades about -0.09 of its potential returns per unit of risk. The Optomed PLC is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 421.00 in Optomed PLC on August 30, 2024 and sell it today you would earn a total of 2.00 from holding Optomed PLC or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Tecnotree Oyj vs. Optomed PLC
Performance |
| Timeline |
| Tecnotree Oyj |
| Optomed PLC |
Tecnotree Oyj and Optomed PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tecnotree Oyj and Optomed PLC
The main advantage of trading using opposite Tecnotree Oyj and Optomed PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tecnotree Oyj position performs unexpectedly, Optomed PLC 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 Optomed PLC will offset losses from the drop in Optomed PLC's long position.The idea behind Tecnotree Oyj and Optomed PLC 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.| Optomed PLC vs. Harvia Oyj | Optomed PLC vs. Revenio Group | Optomed PLC vs. Qt Group Oyj | Optomed PLC vs. Tecnotree 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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