Correlation Between Addnode Group and NOTE AB
Can any of the company-specific risk be diversified away by investing in both Addnode Group and NOTE AB 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 Addnode Group and NOTE AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addnode Group AB and NOTE AB, you can compare the effects of market volatilities on Addnode Group and NOTE 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 Addnode Group with a short position of NOTE AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addnode Group and NOTE AB.
Diversification Opportunities for Addnode Group and NOTE AB
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Addnode and NOTE is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Addnode Group AB and NOTE AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NOTE AB and Addnode Group 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 Addnode Group AB are associated (or correlated) with NOTE AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NOTE AB has no effect on the direction of Addnode Group i.e., Addnode Group and NOTE AB go up and down completely randomly.
Pair Corralation between Addnode Group and NOTE AB
Assuming the 90 days trading horizon Addnode Group AB is expected to generate 1.0 times more return on investment than NOTE AB. However, Addnode Group is 1.0 times more volatile than NOTE AB. It trades about 0.01 of its potential returns per unit of risk. NOTE AB is currently generating about -0.01 per unit of risk. If you would invest 10,133 in Addnode Group AB on August 30, 2024 and sell it today you would lose (123.00) from holding Addnode Group AB or give up 1.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Addnode Group AB vs. NOTE AB
Performance |
| Timeline |
| Addnode Group AB |
| NOTE AB |
Addnode Group and NOTE AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addnode Group and NOTE AB
The main advantage of trading using opposite Addnode Group and NOTE AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addnode Group position performs unexpectedly, NOTE 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 NOTE AB will offset losses from the drop in NOTE AB's long position.| Addnode Group vs. Softronic AB | Addnode Group vs. FormPipe Software AB | Addnode Group vs. Dedicare AB | Addnode Group vs. NOTE AB |
| NOTE AB vs. Bio Works Technologies AB | NOTE AB vs. Vitec Software Group | NOTE AB vs. FormPipe Software AB | NOTE AB vs. Skandinaviska Enskilda Banken |
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 Stocks Directory module to find actively traded stocks across global markets.
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