Correlation Between Arion Banki and MilDef Group
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By analyzing existing cross correlation between Arion banki hf and MilDef Group AB, you can compare the effects of market volatilities on Arion Banki and MilDef Group 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 Arion Banki with a short position of MilDef Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arion Banki and MilDef Group.
Diversification Opportunities for Arion Banki and MilDef Group
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Arion and MilDef is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Arion banki hf and MilDef Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MilDef Group AB and Arion Banki 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 Arion banki hf are associated (or correlated) with MilDef Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MilDef Group AB has no effect on the direction of Arion Banki i.e., Arion Banki and MilDef Group go up and down completely randomly.
Pair Corralation between Arion Banki and MilDef Group
Assuming the 90 days trading horizon Arion Banki is expected to generate 3.1 times less return on investment than MilDef Group. But when comparing it to its historical volatility, Arion banki hf is 2.01 times less risky than MilDef Group. It trades about 0.04 of its potential returns per unit of risk. MilDef Group AB is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,546 in MilDef Group AB on September 4, 2024 and sell it today you would earn a total of 4,554 from holding MilDef Group AB or generate 60.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arion banki hf vs. MilDef Group AB
Performance |
| Timeline |
| Arion banki hf |
| MilDef Group AB |
Arion Banki and MilDef Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arion Banki and MilDef Group
The main advantage of trading using opposite Arion Banki and MilDef Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arion Banki position performs unexpectedly, MilDef Group 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 MilDef Group will offset losses from the drop in MilDef Group's long position.| Arion Banki vs. Atrium Ljungberg AB | Arion Banki vs. Arjo AB | Arion Banki vs. Bravida Holding AB | Arion Banki vs. Avanza Bank Holding |
| MilDef Group vs. Vitec Software Group | MilDef Group vs. G5 Entertainment publ | MilDef Group vs. SaltX Technology Holding | MilDef Group vs. Invisio Communications 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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