Correlation Between Raisio Oyj and Wartsila Oyj

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

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

Diversification Opportunities for Raisio Oyj and Wartsila Oyj

0.39

Correlation Coefficient

Raisio Oyj  Wartsila Oyj

Weak diversification

The 3 months correlation between Raisio and Wartsila is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Raisio Oyj Vaihto osake and Wartsila Oyj Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wartsila Oyj Abp and Raisio 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 Raisio Oyj Vaihto osake are associated (or correlated) with Wartsila Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wartsila Oyj Abp has no effect on the direction of Raisio Oyj i.e., Raisio Oyj and Wartsila Oyj go up and down completely randomly.

Pair Corralation between Raisio Oyj and Wartsila Oyj

Assuming the 90 days trading horizon Raisio Oyj is expected to generate 5.41 times less return on investment than Wartsila Oyj. But when comparing it to its historical volatility, Raisio Oyj Vaihto osake is 1.14 times less risky than Wartsila Oyj. It trades about 0.07 of its potential returns per unit of risk. Wartsila Oyj Abp is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  1,681  in Wartsila Oyj Abp on May 8, 2025 and sell it today you would earn a total of  754.00  from holding Wartsila Oyj Abp or generate 44.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Raisio Oyj Vaihto osake  vs.  Wartsila Oyj Abp

Raisio Oyj Vaihto

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Raisio Oyj Vaihto osake are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent technical indicators, Raisio Oyj may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Wartsila Oyj Abp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Wartsila Oyj Abp are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent technical indicators, Wartsila Oyj demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Raisio Oyj and Wartsila Oyj

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

The idea behind Raisio Oyj Vaihto osake and Wartsila Oyj Abp 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.