Correlation Between Avanza Bank and Maven Wireless
Can any of the company-specific risk be diversified away by investing in both Avanza Bank and Maven Wireless 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 Avanza Bank and Maven Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avanza Bank Holding and Maven Wireless Sweden, you can compare the effects of market volatilities on Avanza Bank and Maven Wireless 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 Avanza Bank with a short position of Maven Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avanza Bank and Maven Wireless.
Diversification Opportunities for Avanza Bank and Maven Wireless
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Avanza and Maven is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Avanza Bank Holding and Maven Wireless Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maven Wireless Sweden and Avanza Bank 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 Avanza Bank Holding are associated (or correlated) with Maven Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maven Wireless Sweden has no effect on the direction of Avanza Bank i.e., Avanza Bank and Maven Wireless go up and down completely randomly.
Pair Corralation between Avanza Bank and Maven Wireless
Assuming the 90 days trading horizon Avanza Bank Holding is expected to generate 0.41 times more return on investment than Maven Wireless. However, Avanza Bank Holding is 2.45 times less risky than Maven Wireless. It trades about -0.11 of its potential returns per unit of risk. Maven Wireless Sweden is currently generating about -0.15 per unit of risk. If you would invest 22,610 in Avanza Bank Holding on August 29, 2024 and sell it today you would lose (660.00) from holding Avanza Bank Holding or give up 2.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avanza Bank Holding vs. Maven Wireless Sweden
Performance |
| Timeline |
| Avanza Bank Holding |
| Maven Wireless Sweden |
Avanza Bank and Maven Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avanza Bank and Maven Wireless
The main advantage of trading using opposite Avanza Bank and Maven Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avanza Bank position performs unexpectedly, Maven Wireless 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 Maven Wireless will offset losses from the drop in Maven Wireless' long position.| Avanza Bank vs. Axfood AB | Avanza Bank vs. Samhllsbyggnadsbolaget i Norden | Avanza Bank vs. Castellum AB | Avanza Bank vs. Investor AB ser |
| Maven Wireless vs. Lidds AB | Maven Wireless vs. Serstech AB | Maven Wireless vs. Transtema Group AB | Maven Wireless vs. Enorama Pharma 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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