Correlation Between Autoliv and Atlas Copco
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By analyzing existing cross correlation between Autoliv and Atlas Copco AB, you can compare the effects of market volatilities on Autoliv and Atlas Copco 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 Autoliv with a short position of Atlas Copco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autoliv and Atlas Copco.
Diversification Opportunities for Autoliv and Atlas Copco
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Autoliv and Atlas is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Autoliv and Atlas Copco AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Copco AB and Autoliv 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 Autoliv are associated (or correlated) with Atlas Copco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Copco AB has no effect on the direction of Autoliv i.e., Autoliv and Atlas Copco go up and down completely randomly.
Pair Corralation between Autoliv and Atlas Copco
Assuming the 90 days trading horizon Autoliv is expected to generate 1.08 times more return on investment than Atlas Copco. However, Autoliv is 1.08 times more volatile than Atlas Copco AB. It trades about 0.04 of its potential returns per unit of risk. Atlas Copco AB is currently generating about 0.04 per unit of risk. If you would invest 79,653 in Autoliv on September 2, 2024 and sell it today you would earn a total of 28,347 from holding Autoliv or generate 35.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autoliv vs. Atlas Copco AB
Performance |
| Timeline |
| Autoliv |
| Atlas Copco AB |
Autoliv and Atlas Copco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autoliv and Atlas Copco
The main advantage of trading using opposite Autoliv and Atlas Copco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autoliv position performs unexpectedly, Atlas Copco 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 Atlas Copco will offset losses from the drop in Atlas Copco's long position.| Autoliv vs. Episurf Medical AB | Autoliv vs. Online Brands Nordic | Autoliv vs. Scandinavian Enviro Systems | Autoliv vs. Acconeer AB |
| Atlas Copco vs. Sandvik AB | Atlas Copco vs. AB SKF | Atlas Copco vs. Alfa Laval AB | Atlas Copco vs. ASSA ABLOY 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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