Correlation Between YIT Oyj and Aktia Bank
Can any of the company-specific risk be diversified away by investing in both YIT Oyj and Aktia Bank 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 YIT Oyj and Aktia Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YIT Oyj and Aktia Bank Abp, you can compare the effects of market volatilities on YIT Oyj and Aktia Bank 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 YIT Oyj with a short position of Aktia Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of YIT Oyj and Aktia Bank.
Diversification Opportunities for YIT Oyj and Aktia Bank
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between YIT and Aktia is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding YIT Oyj and Aktia Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aktia Bank Abp and YIT Oyj 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 YIT Oyj are associated (or correlated) with Aktia Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aktia Bank Abp has no effect on the direction of YIT Oyj i.e., YIT Oyj and Aktia Bank go up and down completely randomly.
Pair Corralation between YIT Oyj and Aktia Bank
Assuming the 90 days trading horizon YIT Oyj is expected to generate 2.18 times more return on investment than Aktia Bank. However, YIT Oyj is 2.18 times more volatile than Aktia Bank Abp. It trades about 0.01 of its potential returns per unit of risk. Aktia Bank Abp is currently generating about 0.01 per unit of risk. If you would invest 252.00 in YIT Oyj on August 25, 2024 and sell it today you would lose (1.00) from holding YIT Oyj or give up 0.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YIT Oyj vs. Aktia Bank Abp
Performance |
| Timeline |
| YIT Oyj |
| Aktia Bank Abp |
YIT Oyj and Aktia Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YIT Oyj and Aktia Bank
The main advantage of trading using opposite YIT Oyj and Aktia Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YIT Oyj position performs unexpectedly, Aktia Bank 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 Aktia Bank will offset losses from the drop in Aktia Bank's long position.| YIT Oyj vs. Aktia Bank Abp | YIT Oyj vs. Alandsbanken Abp B | YIT Oyj vs. Alandsbanken Abp A | YIT Oyj vs. Sampo Oyj A |
| Aktia Bank vs. Sampo Oyj A | Aktia Bank vs. Tokmanni Group Oyj | Aktia Bank vs. Nordea Bank Abp | Aktia Bank vs. TietoEVRY Corp |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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