Correlation Between Autoliv and Lipidor Ab
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By analyzing existing cross correlation between Autoliv and Lipidor Ab, you can compare the effects of market volatilities on Autoliv and Lipidor Ab 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 Lipidor Ab. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autoliv and Lipidor Ab.
Diversification Opportunities for Autoliv and Lipidor Ab
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Autoliv and Lipidor is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Autoliv and Lipidor Ab in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipidor 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 Lipidor Ab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lipidor Ab has no effect on the direction of Autoliv i.e., Autoliv and Lipidor Ab go up and down completely randomly.
Pair Corralation between Autoliv and Lipidor Ab
Assuming the 90 days trading horizon Autoliv is expected to generate 8.97 times less return on investment than Lipidor Ab. But when comparing it to its historical volatility, Autoliv is 8.13 times less risky than Lipidor Ab. It trades about 0.03 of its potential returns per unit of risk. Lipidor Ab is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 64.00 in Lipidor Ab on October 26, 2024 and sell it today you would lose (40.00) from holding Lipidor Ab or give up 62.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autoliv vs. Lipidor Ab
Performance |
| Timeline |
| Autoliv |
| Lipidor Ab |
Autoliv and Lipidor Ab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autoliv and Lipidor Ab
The main advantage of trading using opposite Autoliv and Lipidor Ab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autoliv position performs unexpectedly, Lipidor Ab 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 Lipidor Ab will offset losses from the drop in Lipidor Ab's long position.The idea behind Autoliv and Lipidor Ab pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Lipidor Ab vs. BioInvent International AB | Lipidor Ab vs. Hansa Biopharma AB | Lipidor Ab vs. ExpreS2ion Biotech Holding | Lipidor Ab vs. Saniona 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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