Correlation Between AcadeMedia and ALM Equity
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By analyzing existing cross correlation between AcadeMedia AB and ALM Equity AB, you can compare the effects of market volatilities on AcadeMedia and ALM Equity 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 AcadeMedia with a short position of ALM Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of AcadeMedia and ALM Equity.
Diversification Opportunities for AcadeMedia and ALM Equity
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AcadeMedia and ALM is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding AcadeMedia AB and ALM Equity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALM Equity AB and AcadeMedia 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 AcadeMedia AB are associated (or correlated) with ALM Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALM Equity AB has no effect on the direction of AcadeMedia i.e., AcadeMedia and ALM Equity go up and down completely randomly.
Pair Corralation between AcadeMedia and ALM Equity
Assuming the 90 days trading horizon AcadeMedia AB is expected to generate 1.34 times more return on investment than ALM Equity. However, AcadeMedia is 1.34 times more volatile than ALM Equity AB. It trades about 0.09 of its potential returns per unit of risk. ALM Equity AB is currently generating about 0.07 per unit of risk. If you would invest 4,775 in AcadeMedia AB on September 12, 2024 and sell it today you would earn a total of 1,755 from holding AcadeMedia AB or generate 36.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AcadeMedia AB vs. ALM Equity AB
Performance |
| Timeline |
| AcadeMedia AB |
| ALM Equity AB |
AcadeMedia and ALM Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AcadeMedia and ALM Equity
The main advantage of trading using opposite AcadeMedia and ALM Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AcadeMedia position performs unexpectedly, ALM Equity 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 ALM Equity will offset losses from the drop in ALM Equity's long position.| AcadeMedia vs. Inwido AB | AcadeMedia vs. Alimak Hek Group | AcadeMedia vs. Dometic Group AB | AcadeMedia vs. Byggmax Group AB |
| ALM Equity vs. Upsales Technology AB | ALM Equity vs. Catena Media plc | ALM Equity vs. Systemair AB | ALM Equity vs. Scandinavian ChemoTech AB |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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