Correlation Between Xplora Technologies and Ocean Sun
Can any of the company-specific risk be diversified away by investing in both Xplora Technologies and Ocean Sun 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 Xplora Technologies and Ocean Sun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xplora Technologies As and Ocean Sun As, you can compare the effects of market volatilities on Xplora Technologies and Ocean Sun 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 Xplora Technologies with a short position of Ocean Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xplora Technologies and Ocean Sun.
Diversification Opportunities for Xplora Technologies and Ocean Sun
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Xplora and Ocean is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Xplora Technologies As and Ocean Sun As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Sun As and Xplora Technologies 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 Xplora Technologies As are associated (or correlated) with Ocean Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Sun As has no effect on the direction of Xplora Technologies i.e., Xplora Technologies and Ocean Sun go up and down completely randomly.
Pair Corralation between Xplora Technologies and Ocean Sun
Assuming the 90 days trading horizon Xplora Technologies As is expected to generate 0.47 times more return on investment than Ocean Sun. However, Xplora Technologies As is 2.13 times less risky than Ocean Sun. It trades about 0.39 of its potential returns per unit of risk. Ocean Sun As is currently generating about 0.04 per unit of risk. If you would invest 1,620 in Xplora Technologies As on September 6, 2024 and sell it today you would earn a total of 1,740 from holding Xplora Technologies As or generate 107.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Xplora Technologies As vs. Ocean Sun As
Performance |
Timeline |
Xplora Technologies |
Ocean Sun As |
Xplora Technologies and Ocean Sun Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xplora Technologies and Ocean Sun
The main advantage of trading using opposite Xplora Technologies and Ocean Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xplora Technologies position performs unexpectedly, Ocean Sun 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 Ocean Sun will offset losses from the drop in Ocean Sun's long position.Xplora Technologies vs. Airthings ASA | Xplora Technologies vs. Nordic Unmanned As | Xplora Technologies vs. Pexip Holding ASA | Xplora Technologies vs. Huddlestock Fintech As |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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