Correlation Between Spinnova and Sanoma Oyj
Can any of the company-specific risk be diversified away by investing in both Spinnova and Sanoma 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 Spinnova and Sanoma Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spinnova Oy and Sanoma Oyj, you can compare the effects of market volatilities on Spinnova and Sanoma 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 Spinnova with a short position of Sanoma Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spinnova and Sanoma Oyj.
Diversification Opportunities for Spinnova and Sanoma Oyj
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Spinnova and Sanoma is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Spinnova Oy and Sanoma Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanoma Oyj and Spinnova 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 Spinnova Oy are associated (or correlated) with Sanoma Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanoma Oyj has no effect on the direction of Spinnova i.e., Spinnova and Sanoma Oyj go up and down completely randomly.
Pair Corralation between Spinnova and Sanoma Oyj
Assuming the 90 days trading horizon Spinnova Oy is expected to under-perform the Sanoma Oyj. In addition to that, Spinnova is 1.94 times more volatile than Sanoma Oyj. It trades about -0.07 of its total potential returns per unit of risk. Sanoma Oyj is currently generating about 0.03 per unit of volatility. If you would invest 641.00 in Sanoma Oyj on September 12, 2024 and sell it today you would earn a total of 94.00 from holding Sanoma Oyj or generate 14.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 99.7% |
Values | Daily Returns |
Spinnova Oy vs. Sanoma Oyj
Performance |
Timeline |
Spinnova Oy |
Sanoma Oyj |
Spinnova and Sanoma Oyj Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Spinnova and Sanoma Oyj
The main advantage of trading using opposite Spinnova and Sanoma Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spinnova position performs unexpectedly, Sanoma 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 Sanoma Oyj will offset losses from the drop in Sanoma Oyj's long position.Spinnova vs. Qt Group Oyj | Spinnova vs. Kempower Oyj | Spinnova vs. Harvia Oyj | Spinnova vs. Nordea Bank Abp |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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