Correlation Between TietoEVRY Corp and Exel Composites
Can any of the company-specific risk be diversified away by investing in both TietoEVRY Corp and Exel Composites 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 TietoEVRY Corp and Exel Composites into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TietoEVRY Corp and Exel Composites Oyj, you can compare the effects of market volatilities on TietoEVRY Corp and Exel Composites 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 TietoEVRY Corp with a short position of Exel Composites. Check out your portfolio center. Please also check ongoing floating volatility patterns of TietoEVRY Corp and Exel Composites.
Diversification Opportunities for TietoEVRY Corp and Exel Composites
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TietoEVRY and Exel is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding TietoEVRY Corp and Exel Composites Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exel Composites Oyj and TietoEVRY Corp 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 TietoEVRY Corp are associated (or correlated) with Exel Composites. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exel Composites Oyj has no effect on the direction of TietoEVRY Corp i.e., TietoEVRY Corp and Exel Composites go up and down completely randomly.
Pair Corralation between TietoEVRY Corp and Exel Composites
Assuming the 90 days trading horizon TietoEVRY Corp is expected to generate 2.14 times less return on investment than Exel Composites. But when comparing it to its historical volatility, TietoEVRY Corp is 2.13 times less risky than Exel Composites. It trades about 0.23 of its potential returns per unit of risk. Exel Composites Oyj is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Exel Composites Oyj on October 21, 2024 and sell it today you would earn a total of 3.00 from holding Exel Composites Oyj or generate 10.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TietoEVRY Corp vs. Exel Composites Oyj
Performance |
| Timeline |
| TietoEVRY Corp |
| Exel Composites Oyj |
TietoEVRY Corp and Exel Composites Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TietoEVRY Corp and Exel Composites
The main advantage of trading using opposite TietoEVRY Corp and Exel Composites positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TietoEVRY Corp position performs unexpectedly, Exel Composites 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 Exel Composites will offset losses from the drop in Exel Composites' long position.| TietoEVRY Corp vs. Sampo Oyj A | TietoEVRY Corp vs. Valmet Oyj | TietoEVRY Corp vs. Nordea Bank Abp | TietoEVRY Corp vs. Fortum Oyj |
| Exel Composites vs. Bittium Oyj | Exel Composites vs. Tecnotree Oyj | Exel Composites vs. Tokmanni Group Oyj | Exel Composites vs. Kamux Suomi Oy |
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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