Correlation Between Exel Composites and Robit Oyj
Can any of the company-specific risk be diversified away by investing in both Exel Composites and Robit 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 Exel Composites and Robit Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exel Composites Oyj and Robit Oyj, you can compare the effects of market volatilities on Exel Composites and Robit 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 Exel Composites with a short position of Robit Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exel Composites and Robit Oyj.
Diversification Opportunities for Exel Composites and Robit Oyj
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Exel and Robit is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Exel Composites Oyj and Robit Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robit Oyj and Exel Composites 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 Exel Composites Oyj are associated (or correlated) with Robit Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robit Oyj has no effect on the direction of Exel Composites i.e., Exel Composites and Robit Oyj go up and down completely randomly.
Pair Corralation between Exel Composites and Robit Oyj
Assuming the 90 days trading horizon Exel Composites Oyj is expected to under-perform the Robit Oyj. But the stock apears to be less risky and, when comparing its historical volatility, Exel Composites Oyj is 1.22 times less risky than Robit Oyj. The stock trades about -0.2 of its potential returns per unit of risk. The Robit Oyj is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 148.00 in Robit Oyj on January 31, 2024 and sell it today you would earn a total of 30.00 from holding Robit Oyj or generate 20.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Exel Composites Oyj vs. Robit Oyj
Performance |
Timeline |
Exel Composites Oyj |
Robit Oyj |
Exel Composites and Robit Oyj Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Exel Composites and Robit Oyj
The main advantage of trading using opposite Exel Composites and Robit Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exel Composites position performs unexpectedly, Robit 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 Robit Oyj will offset losses from the drop in Robit Oyj's long position.Exel Composites vs. Fortum Oyj | Exel Composites vs. Nordea Bank Abp | Exel Composites vs. Sampo Oyj A | Exel Composites vs. Neste Oil Oyj |
Robit Oyj vs. Fortum Oyj | Robit Oyj vs. Nordea Bank Abp | Robit Oyj vs. Sampo Oyj A | Robit Oyj vs. Neste Oil Oyj |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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