Correlation Between ALM Equity and Brinova Fastigheter
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By analyzing existing cross correlation between ALM Equity AB and Brinova Fastigheter AB, you can compare the effects of market volatilities on ALM Equity and Brinova Fastigheter 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 ALM Equity with a short position of Brinova Fastigheter. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALM Equity and Brinova Fastigheter.
Diversification Opportunities for ALM Equity and Brinova Fastigheter
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ALM and Brinova is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding ALM Equity AB and Brinova Fastigheter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brinova Fastigheter and ALM Equity 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 ALM Equity AB are associated (or correlated) with Brinova Fastigheter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brinova Fastigheter has no effect on the direction of ALM Equity i.e., ALM Equity and Brinova Fastigheter go up and down completely randomly.
Pair Corralation between ALM Equity and Brinova Fastigheter
Assuming the 90 days trading horizon ALM Equity AB is expected to generate 0.33 times more return on investment than Brinova Fastigheter. However, ALM Equity AB is 3.03 times less risky than Brinova Fastigheter. It trades about -0.3 of its potential returns per unit of risk. Brinova Fastigheter AB is currently generating about -0.35 per unit of risk. If you would invest 9,000 in ALM Equity AB on September 14, 2024 and sell it today you would lose (420.00) from holding ALM Equity AB or give up 4.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
ALM Equity AB vs. Brinova Fastigheter AB
Performance |
| Timeline |
| ALM Equity AB |
| Brinova Fastigheter |
ALM Equity and Brinova Fastigheter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALM Equity and Brinova Fastigheter
The main advantage of trading using opposite ALM Equity and Brinova Fastigheter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALM Equity position performs unexpectedly, Brinova Fastigheter 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 Brinova Fastigheter will offset losses from the drop in Brinova Fastigheter's long position.| ALM Equity vs. Fabege AB | ALM Equity vs. Castellum AB | ALM Equity vs. Wallenstam AB | ALM Equity vs. Fastighets AB Balder |
| Brinova Fastigheter vs. Catena AB | Brinova Fastigheter vs. Dios Fastigheter AB | Brinova Fastigheter vs. Wihlborgs Fastigheter AB | Brinova Fastigheter vs. Fabege 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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