Correlation Between OXE Marine and Autoliv

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

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

Diversification Opportunities for OXE Marine and Autoliv

-0.37

Correlation Coefficient

OXE Marine  Autoliv

Very good diversification

The 3 months correlation between OXE and Autoliv is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding OXE Marine AB and Autoliv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autoliv and OXE Marine 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 OXE Marine AB are associated (or correlated) with Autoliv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autoliv has no effect on the direction of OXE Marine i.e., OXE Marine and Autoliv go up and down completely randomly.

Pair Corralation between OXE Marine and Autoliv

Assuming the 90 days trading horizon OXE Marine AB is expected to under-perform the Autoliv. In addition to that, OXE Marine is 2.97 times more volatile than Autoliv. It trades about 0.0 of its total potential returns per unit of risk. Autoliv is currently generating about 0.04 per unit of volatility. If you would invest  104,263  in Autoliv on August 31, 2024 and sell it today you would earn a total of  4,677  from holding Autoliv or generate 4.49% return on investment over 90 days.

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

OXE Marine AB  vs.  Autoliv

OXE Marine AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OXE Marine AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, OXE Marine is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Autoliv

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Autoliv are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Autoliv is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with OXE Marine and Autoliv

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

The idea behind OXE Marine AB and Autoliv 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.