Correlation Between Harvia Oyj and Robit Oyj

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

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

Diversification Opportunities for Harvia Oyj and Robit Oyj

-0.23

Correlation Coefficient

Harvia Oyj  Robit Oyj

Very good diversification

The 3 months correlation between Harvia and Robit is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Harvia Oyj and Robit Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robit Oyj and Harvia 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 Harvia 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 Harvia Oyj i.e., Harvia Oyj and Robit Oyj go up and down completely randomly.

Pair Corralation between Harvia Oyj and Robit Oyj

Assuming the 90 days trading horizon Harvia Oyj is expected to under-perform the Robit Oyj. In addition to that, Harvia Oyj is 1.14 times more volatile than Robit Oyj. It trades about -0.09 of its total potential returns per unit of risk. Robit Oyj is currently generating about 0.01 per unit of volatility. If you would invest  138.00  in Robit Oyj on September 2, 2024 and sell it today you would earn a total of  0.00  from holding Robit Oyj or generate 0.0% return on investment over 90 days.

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

Harvia Oyj  vs.  Robit Oyj

Harvia Oyj

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Harvia Oyj are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Harvia Oyj is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Robit Oyj

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Robit Oyj has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Harvia Oyj and Robit Oyj

The main advantage of trading using opposite Harvia Oyj and Robit Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harvia Oyj 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.

The idea behind Harvia Oyj and Robit Oyj 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.