Correlation Between Tokmanni Group and Bittium Oyj
Can any of the company-specific risk be diversified away by investing in both Tokmanni Group and Bittium 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 Tokmanni Group and Bittium Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tokmanni Group Oyj and Bittium Oyj, you can compare the effects of market volatilities on Tokmanni Group and Bittium 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 Tokmanni Group with a short position of Bittium Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tokmanni Group and Bittium Oyj.
Diversification Opportunities for Tokmanni Group and Bittium Oyj
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tokmanni and Bittium is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Tokmanni Group Oyj and Bittium Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bittium Oyj and Tokmanni Group 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 Tokmanni Group Oyj are associated (or correlated) with Bittium Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bittium Oyj has no effect on the direction of Tokmanni Group i.e., Tokmanni Group and Bittium Oyj go up and down completely randomly.
Pair Corralation between Tokmanni Group and Bittium Oyj
Assuming the 90 days trading horizon Tokmanni Group Oyj is expected to generate 1.16 times more return on investment than Bittium Oyj. However, Tokmanni Group is 1.16 times more volatile than Bittium Oyj. It trades about 0.09 of its potential returns per unit of risk. Bittium Oyj is currently generating about 0.05 per unit of risk. If you would invest 1,071 in Tokmanni Group Oyj on August 30, 2024 and sell it today you would earn a total of 109.00 from holding Tokmanni Group Oyj or generate 10.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Tokmanni Group Oyj vs. Bittium Oyj
Performance |
| Timeline |
| Tokmanni Group Oyj |
| Bittium Oyj |
Tokmanni Group and Bittium Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tokmanni Group and Bittium Oyj
The main advantage of trading using opposite Tokmanni Group and Bittium Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tokmanni Group position performs unexpectedly, Bittium 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 Bittium Oyj will offset losses from the drop in Bittium Oyj's long position.| Tokmanni Group vs. Harvia Oyj | Tokmanni Group vs. Kamux Suomi Oy | Tokmanni Group vs. Qt Group Oyj | Tokmanni Group vs. Revenio Group |
| Bittium Oyj vs. Revenio Group | Bittium Oyj vs. Outokumpu Oyj | Bittium Oyj vs. Qt Group Oyj | Bittium Oyj vs. CapMan Oyj B |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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