Correlation Between Axfood AB and TradeDoubler
Can any of the company-specific risk be diversified away by investing in both Axfood AB and TradeDoubler 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 Axfood AB and TradeDoubler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axfood AB and TradeDoubler AB, you can compare the effects of market volatilities on Axfood AB and TradeDoubler 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 Axfood AB with a short position of TradeDoubler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axfood AB and TradeDoubler.
Diversification Opportunities for Axfood AB and TradeDoubler
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Axfood and TradeDoubler is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Axfood AB and TradeDoubler AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TradeDoubler AB and Axfood AB 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 Axfood AB are associated (or correlated) with TradeDoubler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TradeDoubler AB has no effect on the direction of Axfood AB i.e., Axfood AB and TradeDoubler go up and down completely randomly.
Pair Corralation between Axfood AB and TradeDoubler
Assuming the 90 days trading horizon Axfood AB is expected to under-perform the TradeDoubler. But the stock apears to be less risky and, when comparing its historical volatility, Axfood AB is 2.53 times less risky than TradeDoubler. The stock trades about -0.11 of its potential returns per unit of risk. The TradeDoubler AB is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 342.00 in TradeDoubler AB on October 12, 2024 and sell it today you would earn a total of 40.00 from holding TradeDoubler AB or generate 11.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axfood AB vs. TradeDoubler AB
Performance |
| Timeline |
| Axfood AB |
| TradeDoubler AB |
Axfood AB and TradeDoubler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axfood AB and TradeDoubler
The main advantage of trading using opposite Axfood AB and TradeDoubler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axfood AB position performs unexpectedly, TradeDoubler 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 TradeDoubler will offset losses from the drop in TradeDoubler's long position.| Axfood AB vs. Castellum AB | Axfood AB vs. Tele2 AB | Axfood AB vs. Investor AB ser | Axfood AB vs. Kinnevik Investment AB |
| TradeDoubler vs. Precise Biometrics AB | TradeDoubler vs. BE Group AB | TradeDoubler vs. Eniro AB | TradeDoubler vs. Softronic 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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