Correlation Between PolyPlank Publ and Orexo AB
Can any of the company-specific risk be diversified away by investing in both PolyPlank Publ and Orexo AB 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 PolyPlank Publ and Orexo AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PolyPlank publ AB and Orexo AB, you can compare the effects of market volatilities on PolyPlank Publ and Orexo AB 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 PolyPlank Publ with a short position of Orexo AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of PolyPlank Publ and Orexo AB.
Diversification Opportunities for PolyPlank Publ and Orexo AB
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between PolyPlank and Orexo is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding PolyPlank publ AB and Orexo AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orexo AB and PolyPlank Publ 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 PolyPlank publ AB are associated (or correlated) with Orexo AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orexo AB has no effect on the direction of PolyPlank Publ i.e., PolyPlank Publ and Orexo AB go up and down completely randomly.
Pair Corralation between PolyPlank Publ and Orexo AB
Assuming the 90 days trading horizon PolyPlank publ AB is expected to generate 1.29 times more return on investment than Orexo AB. However, PolyPlank Publ is 1.29 times more volatile than Orexo AB. It trades about 0.14 of its potential returns per unit of risk. Orexo AB is currently generating about 0.1 per unit of risk. If you would invest 3.20 in PolyPlank publ AB on March 18, 2024 and sell it today you would earn a total of 0.40 from holding PolyPlank publ AB or generate 12.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
PolyPlank publ AB vs. Orexo AB
Performance |
Timeline |
PolyPlank publ AB |
Orexo AB |
PolyPlank Publ and Orexo AB Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PolyPlank Publ and Orexo AB
The main advantage of trading using opposite PolyPlank Publ and Orexo AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PolyPlank Publ position performs unexpectedly, Orexo AB 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 Orexo AB will offset losses from the drop in Orexo AB's long position.PolyPlank Publ vs. Online Brands Nordic | PolyPlank Publ vs. Organoclick AB | PolyPlank Publ vs. Minesto AB |
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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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