Correlation Between Tethys Oil and Anoto Group
Can any of the company-specific risk be diversified away by investing in both Tethys Oil and Anoto Group 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 Tethys Oil and Anoto Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tethys Oil AB and Anoto Group AB, you can compare the effects of market volatilities on Tethys Oil and Anoto Group 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 Tethys Oil with a short position of Anoto Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tethys Oil and Anoto Group.
Diversification Opportunities for Tethys Oil and Anoto Group
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tethys and Anoto is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Tethys Oil AB and Anoto Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anoto Group AB and Tethys Oil 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 Tethys Oil AB are associated (or correlated) with Anoto Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anoto Group AB has no effect on the direction of Tethys Oil i.e., Tethys Oil and Anoto Group go up and down completely randomly.
Pair Corralation between Tethys Oil and Anoto Group
Assuming the 90 days trading horizon Tethys Oil AB is expected to generate 0.01 times more return on investment than Anoto Group. However, Tethys Oil AB is 77.22 times less risky than Anoto Group. It trades about -0.34 of its potential returns per unit of risk. Anoto Group AB is currently generating about -0.01 per unit of risk. If you would invest 5,850 in Tethys Oil AB on November 3, 2024 and sell it today you would lose (30.00) from holding Tethys Oil AB or give up 0.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 33.33% |
| Values | Daily Returns |
Tethys Oil AB vs. Anoto Group AB
Performance |
| Timeline |
| Tethys Oil AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Anoto Group AB |
Tethys Oil and Anoto Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tethys Oil and Anoto Group
The main advantage of trading using opposite Tethys Oil and Anoto Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tethys Oil position performs unexpectedly, Anoto Group 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 Anoto Group will offset losses from the drop in Anoto Group's long position.| Tethys Oil vs. Africa Oil Corp | Tethys Oil vs. International Petroleum | Tethys Oil vs. Maha Energy AB | Tethys Oil vs. Nobia AB |
| Anoto Group vs. Precise Biometrics AB | Anoto Group vs. Fingerprint Cards AB | Anoto Group vs. BioInvent International AB | Anoto Group vs. Bong 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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