Correlation Between Occidental and Naked Wines
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By analyzing existing cross correlation between Occidental Petroleum 8875 and Naked Wines plc, you can compare the effects of market volatilities on Occidental and Naked Wines 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 Occidental with a short position of Naked Wines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Occidental and Naked Wines.
Diversification Opportunities for Occidental and Naked Wines
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Occidental and Naked is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Occidental Petroleum 8875 and Naked Wines plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naked Wines plc and Occidental 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 Occidental Petroleum 8875 are associated (or correlated) with Naked Wines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naked Wines plc has no effect on the direction of Occidental i.e., Occidental and Naked Wines go up and down completely randomly.
Pair Corralation between Occidental and Naked Wines
Assuming the 90 days trading horizon Occidental Petroleum 8875 is expected to generate 0.17 times more return on investment than Naked Wines. However, Occidental Petroleum 8875 is 5.9 times less risky than Naked Wines. It trades about 0.01 of its potential returns per unit of risk. Naked Wines plc is currently generating about -0.01 per unit of risk. If you would invest 11,603 in Occidental Petroleum 8875 on September 12, 2024 and sell it today you would earn a total of 71.00 from holding Occidental Petroleum 8875 or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Occidental Petroleum 8875 vs. Naked Wines plc
Performance |
| Timeline |
| Occidental Petroleum 8875 |
| Naked Wines plc |
Occidental and Naked Wines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Occidental and Naked Wines
The main advantage of trading using opposite Occidental and Naked Wines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Occidental position performs unexpectedly, Naked Wines 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 Naked Wines will offset losses from the drop in Naked Wines' long position.| Occidental vs. AEP TEX INC | Occidental vs. US BANK NATIONAL | Occidental vs. Applied Blockchain | Occidental vs. BigBearai Holdings |
| Naked Wines vs. Pernod Ricard SA | Naked Wines vs. Naked Wines plc | Naked Wines vs. Crimson Wine | Naked Wines vs. Brown Forman |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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