Correlation Between EEducation Albert and Mekonomen
Can any of the company-specific risk be diversified away by investing in both EEducation Albert and Mekonomen 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 Mekonomen 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 Mekonomen AB, you can compare the effects of market volatilities on EEducation Albert and Mekonomen 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 Mekonomen. Check out your portfolio center. Please also check ongoing floating volatility patterns of EEducation Albert and Mekonomen.
Diversification Opportunities for EEducation Albert and Mekonomen
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EEducation and Mekonomen is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding eEducation Albert AB and Mekonomen AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mekonomen AB 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 Mekonomen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mekonomen AB has no effect on the direction of EEducation Albert i.e., EEducation Albert and Mekonomen go up and down completely randomly.
Pair Corralation between EEducation Albert and Mekonomen
Assuming the 90 days trading horizon eEducation Albert AB is expected to under-perform the Mekonomen. In addition to that, EEducation Albert is 2.12 times more volatile than Mekonomen AB. It trades about -0.07 of its total potential returns per unit of risk. Mekonomen AB is currently generating about 0.02 per unit of volatility. If you would invest 11,312 in Mekonomen AB on October 30, 2024 and sell it today you would earn a total of 1,508 from holding Mekonomen AB or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
eEducation Albert AB vs. Mekonomen AB
Performance |
| Timeline |
| eEducation Albert |
| Mekonomen AB |
EEducation Albert and Mekonomen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EEducation Albert and Mekonomen
The main advantage of trading using opposite EEducation Albert and Mekonomen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EEducation Albert position performs unexpectedly, Mekonomen 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 Mekonomen will offset losses from the drop in Mekonomen'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 |
| Mekonomen vs. Clas Ohlson AB | Mekonomen vs. Bilia AB | Mekonomen vs. Byggmax Group AB | Mekonomen vs. Peab 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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