Correlation Between EEducation Albert and SpectraCure
Can any of the company-specific risk be diversified away by investing in both EEducation Albert and SpectraCure 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 SpectraCure 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 SpectraCure AB, you can compare the effects of market volatilities on EEducation Albert and SpectraCure 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 SpectraCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of EEducation Albert and SpectraCure.
Diversification Opportunities for EEducation Albert and SpectraCure
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EEducation and SpectraCure is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding eEducation Albert AB and SpectraCure AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SpectraCure 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 SpectraCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SpectraCure AB has no effect on the direction of EEducation Albert i.e., EEducation Albert and SpectraCure go up and down completely randomly.
Pair Corralation between EEducation Albert and SpectraCure
Assuming the 90 days trading horizon eEducation Albert AB is expected to under-perform the SpectraCure. But the stock apears to be less risky and, when comparing its historical volatility, eEducation Albert AB is 1.19 times less risky than SpectraCure. The stock trades about -0.06 of its potential returns per unit of risk. The SpectraCure AB is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 659.00 in SpectraCure AB on August 30, 2024 and sell it today you would lose (504.00) from holding SpectraCure AB or give up 76.48% 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. SpectraCure AB
Performance |
| Timeline |
| eEducation Albert |
| SpectraCure AB |
EEducation Albert and SpectraCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EEducation Albert and SpectraCure
The main advantage of trading using opposite EEducation Albert and SpectraCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EEducation Albert position performs unexpectedly, SpectraCure 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 SpectraCure will offset losses from the drop in SpectraCure'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 |
| SpectraCure vs. KABE Group AB | SpectraCure vs. IAR Systems Group | SpectraCure vs. Mekonomen AB | SpectraCure vs. eEducation Albert 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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