Correlation Between Ossiam ESG and Ossiam Irl

Can any of the company-specific risk be diversified away by investing in both Ossiam ESG and Ossiam Irl 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 Ossiam ESG and Ossiam Irl into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ossiam ESG Shiller and Ossiam Irl Icav, you can compare the effects of market volatilities on Ossiam ESG and Ossiam Irl 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 Ossiam ESG with a short position of Ossiam Irl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ossiam ESG and Ossiam Irl.

Diversification Opportunities for Ossiam ESG and Ossiam Irl

-0.82

Correlation Coefficient

Ossiam ESG  Ossiam Irl

Pay attention - limited upside

The 3 months correlation between Ossiam and Ossiam is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Ossiam ESG Shiller and Ossiam Irl Icav in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ossiam Irl Icav and Ossiam ESG 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 Ossiam ESG Shiller are associated (or correlated) with Ossiam Irl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ossiam Irl Icav has no effect on the direction of Ossiam ESG i.e., Ossiam ESG and Ossiam Irl go up and down completely randomly.

Pair Corralation between Ossiam ESG and Ossiam Irl

Assuming the 90 days trading horizon Ossiam ESG Shiller is expected to under-perform the Ossiam Irl. But the etf apears to be less risky and, when comparing its historical volatility, Ossiam ESG Shiller is 1.31 times less risky than Ossiam Irl. The etf trades about -0.05 of its potential returns per unit of risk. The Ossiam Irl Icav is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  17,482  in Ossiam Irl Icav on September 27, 2024 and sell it today you would earn a total of  3,193  from holding Ossiam Irl Icav or generate 18.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Ossiam ESG Shiller  vs.  Ossiam Irl Icav

Ossiam ESG Shiller

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ossiam ESG Shiller has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Ossiam Irl Icav

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ossiam Irl Icav are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady technical and fundamental indicators, Ossiam Irl may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Ossiam ESG and Ossiam Irl

The main advantage of trading using opposite Ossiam ESG and Ossiam Irl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ossiam ESG position performs unexpectedly, Ossiam Irl 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 Ossiam Irl will offset losses from the drop in Ossiam Irl's long position.

The idea behind Ossiam ESG Shiller and Ossiam Irl Icav pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.