Correlation Between Trelleborg and OptiCept Technologies
Can any of the company-specific risk be diversified away by investing in both Trelleborg and OptiCept Technologies 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 Trelleborg and OptiCept Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trelleborg AB and OptiCept Technologies AB, you can compare the effects of market volatilities on Trelleborg and OptiCept Technologies 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 Trelleborg with a short position of OptiCept Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trelleborg and OptiCept Technologies.
Diversification Opportunities for Trelleborg and OptiCept Technologies
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Trelleborg and OptiCept is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Trelleborg AB and OptiCept Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiCept Technologies and Trelleborg 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 Trelleborg AB are associated (or correlated) with OptiCept Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiCept Technologies has no effect on the direction of Trelleborg i.e., Trelleborg and OptiCept Technologies go up and down completely randomly.
Pair Corralation between Trelleborg and OptiCept Technologies
Assuming the 90 days trading horizon Trelleborg AB is expected to generate 0.89 times more return on investment than OptiCept Technologies. However, Trelleborg AB is 1.13 times less risky than OptiCept Technologies. It trades about 0.28 of its potential returns per unit of risk. OptiCept Technologies AB is currently generating about 0.0 per unit of risk. If you would invest 36,020 in Trelleborg AB on September 14, 2024 and sell it today you would earn a total of 3,580 from holding Trelleborg AB or generate 9.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trelleborg AB vs. OptiCept Technologies AB
Performance |
| Timeline |
| Trelleborg AB |
| OptiCept Technologies |
Trelleborg and OptiCept Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trelleborg and OptiCept Technologies
The main advantage of trading using opposite Trelleborg and OptiCept Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trelleborg position performs unexpectedly, OptiCept Technologies 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 OptiCept Technologies will offset losses from the drop in OptiCept Technologies' long position.| Trelleborg vs. AB SKF | Trelleborg vs. Sandvik AB | Trelleborg vs. Alfa Laval AB | Trelleborg vs. Husqvarna AB |
| OptiCept Technologies vs. Atlas Copco AB | OptiCept Technologies vs. Atlas Copco AB | OptiCept Technologies vs. Trelleborg AB | OptiCept Technologies vs. Troax Group 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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