Correlation Between EEducation Albert and Kinnevik Investment
Can any of the company-specific risk be diversified away by investing in both EEducation Albert and Kinnevik Investment 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 Kinnevik Investment 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 Kinnevik Investment AB, you can compare the effects of market volatilities on EEducation Albert and Kinnevik Investment 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 Kinnevik Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of EEducation Albert and Kinnevik Investment.
Diversification Opportunities for EEducation Albert and Kinnevik Investment
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between EEducation and Kinnevik is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding eEducation Albert AB and Kinnevik Investment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinnevik Investment 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 Kinnevik Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinnevik Investment has no effect on the direction of EEducation Albert i.e., EEducation Albert and Kinnevik Investment go up and down completely randomly.
Pair Corralation between EEducation Albert and Kinnevik Investment
Assuming the 90 days trading horizon eEducation Albert AB is expected to generate 1.31 times more return on investment than Kinnevik Investment. However, EEducation Albert is 1.31 times more volatile than Kinnevik Investment AB. It trades about -0.01 of its potential returns per unit of risk. Kinnevik Investment AB is currently generating about -0.03 per unit of risk. If you would invest 372.00 in eEducation Albert AB on January 27, 2025 and sell it today you would lose (68.00) from holding eEducation Albert AB or give up 18.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
eEducation Albert AB vs. Kinnevik Investment AB
Performance |
| Timeline |
| eEducation Albert |
| Kinnevik Investment |
EEducation Albert and Kinnevik Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EEducation Albert and Kinnevik Investment
The main advantage of trading using opposite EEducation Albert and Kinnevik Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EEducation Albert position performs unexpectedly, Kinnevik Investment 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 Kinnevik Investment will offset losses from the drop in Kinnevik Investment'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 |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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