Correlation Between Oil Terminal and Aages SA
Can any of the company-specific risk be diversified away by investing in both Oil Terminal and Aages SA 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 Oil Terminal and Aages SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oil Terminal C and Aages SA, you can compare the effects of market volatilities on Oil Terminal and Aages SA 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 Oil Terminal with a short position of Aages SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oil Terminal and Aages SA.
Diversification Opportunities for Oil Terminal and Aages SA
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oil and Aages is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Oil Terminal C and Aages SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aages SA and Oil Terminal 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 Oil Terminal C are associated (or correlated) with Aages SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aages SA has no effect on the direction of Oil Terminal i.e., Oil Terminal and Aages SA go up and down completely randomly.
Pair Corralation between Oil Terminal and Aages SA
Assuming the 90 days trading horizon Oil Terminal is expected to generate 1.5 times less return on investment than Aages SA. In addition to that, Oil Terminal is 1.61 times more volatile than Aages SA. It trades about 0.02 of its total potential returns per unit of risk. Aages SA is currently generating about 0.04 per unit of volatility. If you would invest 660.00 in Aages SA on December 2, 2024 and sell it today you would earn a total of 20.00 from holding Aages SA or generate 3.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Oil Terminal C vs. Aages SA
Performance |
Timeline |
Oil Terminal C |
Aages SA |
Oil Terminal and Aages SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Oil Terminal and Aages SA
The main advantage of trading using opposite Oil Terminal and Aages SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oil Terminal position performs unexpectedly, Aages SA 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 Aages SA will offset losses from the drop in Aages SA's long position.Oil Terminal vs. Digi Communications NV | Oil Terminal vs. Patria Bank SA | Oil Terminal vs. Safetech Innovations SA | Oil Terminal vs. AROBS TRANSILVANIA SOFTWARE |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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