Correlation Between EEducation Albert and Catena Media
Can any of the company-specific risk be diversified away by investing in both EEducation Albert and Catena Media 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 EEducation Albert and Catena Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eEducation Albert AB and Catena Media plc, you can compare the effects of market volatilities on EEducation Albert and Catena Media 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 EEducation Albert with a short position of Catena Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of EEducation Albert and Catena Media.
Diversification Opportunities for EEducation Albert and Catena Media
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EEducation and Catena is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding eEducation Albert AB and Catena Media plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catena Media plc and EEducation Albert 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 eEducation Albert AB are associated (or correlated) with Catena Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catena Media plc has no effect on the direction of EEducation Albert i.e., EEducation Albert and Catena Media go up and down completely randomly.
Pair Corralation between EEducation Albert and Catena Media
Assuming the 90 days trading horizon eEducation Albert AB is expected to generate 0.33 times more return on investment than Catena Media. However, eEducation Albert AB is 3.05 times less risky than Catena Media. It trades about -0.1 of its potential returns per unit of risk. Catena Media plc is currently generating about -0.11 per unit of risk. If you would invest 380.00 in eEducation Albert AB on August 29, 2024 and sell it today you would lose (15.00) from holding eEducation Albert AB or give up 3.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
eEducation Albert AB vs. Catena Media plc
Performance |
| Timeline |
| eEducation Albert |
| Catena Media plc |
EEducation Albert and Catena Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EEducation Albert and Catena Media
The main advantage of trading using opposite EEducation Albert and Catena Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EEducation Albert position performs unexpectedly, Catena Media 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 Catena Media will offset losses from the drop in Catena Media's long position.| EEducation Albert vs. Greater Than AB | EEducation Albert vs. Cint Group AB | EEducation Albert vs. Acconeer AB | EEducation Albert vs. IAR Systems Group |
| Catena Media vs. Betsson AB | Catena Media vs. Kambi Group PLC | Catena Media vs. Better Collective | Catena Media vs. Evolution 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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