Correlation Between Ambu AS and Matas AS
Can any of the company-specific risk be diversified away by investing in both Ambu AS and Matas AS 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 Ambu AS and Matas AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambu AS and Matas AS, you can compare the effects of market volatilities on Ambu AS and Matas AS 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 Ambu AS with a short position of Matas AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambu AS and Matas AS.
Diversification Opportunities for Ambu AS and Matas AS
Good diversification
The 3 months correlation between Ambu and Matas is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Ambu AS and Matas AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matas AS and Ambu AS 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 Ambu AS are associated (or correlated) with Matas AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matas AS has no effect on the direction of Ambu AS i.e., Ambu AS and Matas AS go up and down completely randomly.
Pair Corralation between Ambu AS and Matas AS
Assuming the 90 days trading horizon Ambu AS is expected to under-perform the Matas AS. In addition to that, Ambu AS is 1.55 times more volatile than Matas AS. It trades about -0.19 of its total potential returns per unit of risk. Matas AS is currently generating about 0.05 per unit of volatility. If you would invest 12,280 in Matas AS on September 1, 2024 and sell it today you would earn a total of 220.00 from holding Matas AS or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambu AS vs. Matas AS
Performance |
| Timeline |
| Ambu AS |
| Matas AS |
Ambu AS and Matas AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambu AS and Matas AS
The main advantage of trading using opposite Ambu AS and Matas AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambu AS position performs unexpectedly, Matas AS 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 Matas AS will offset losses from the drop in Matas AS's long position.| Ambu AS vs. Bavarian Nordic | Ambu AS vs. Genmab AS | Ambu AS vs. GN Store Nord | Ambu AS vs. DSV Panalpina AS |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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