Correlation Between Voestalpine and OMV Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both Voestalpine and OMV Aktiengesellscha 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 Voestalpine and OMV Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voestalpine AG and OMV Aktiengesellschaft, you can compare the effects of market volatilities on Voestalpine and OMV Aktiengesellscha 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 Voestalpine with a short position of OMV Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voestalpine and OMV Aktiengesellscha.
Diversification Opportunities for Voestalpine and OMV Aktiengesellscha
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Voestalpine and OMV is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Voestalpine AG and OMV Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OMV Aktiengesellschaft and Voestalpine 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 Voestalpine AG are associated (or correlated) with OMV Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OMV Aktiengesellschaft has no effect on the direction of Voestalpine i.e., Voestalpine and OMV Aktiengesellscha go up and down completely randomly.
Pair Corralation between Voestalpine and OMV Aktiengesellscha
Assuming the 90 days trading horizon Voestalpine AG is expected to under-perform the OMV Aktiengesellscha. In addition to that, Voestalpine is 1.33 times more volatile than OMV Aktiengesellschaft. It trades about -0.16 of its total potential returns per unit of risk. OMV Aktiengesellschaft is currently generating about -0.1 per unit of volatility. If you would invest 4,690 in OMV Aktiengesellschaft on August 24, 2024 and sell it today you would lose (794.00) from holding OMV Aktiengesellschaft or give up 16.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voestalpine AG vs. OMV Aktiengesellschaft
Performance |
| Timeline |
| Voestalpine AG |
| OMV Aktiengesellschaft |
Voestalpine and OMV Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voestalpine and OMV Aktiengesellscha
The main advantage of trading using opposite Voestalpine and OMV Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voestalpine position performs unexpectedly, OMV Aktiengesellscha 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 OMV Aktiengesellscha will offset losses from the drop in OMV Aktiengesellscha's long position.| Voestalpine vs. OMV Aktiengesellschaft | Voestalpine vs. Raiffeisen Bank International | Voestalpine vs. Andritz AG | Voestalpine vs. VERBUND AG |
| OMV Aktiengesellscha vs. Voestalpine AG | OMV Aktiengesellscha vs. Erste Group Bank | OMV Aktiengesellscha vs. Raiffeisen Bank International | OMV Aktiengesellscha vs. VERBUND AG |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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