Correlation Between Addtech AB and VARIOUS EATERIES
Can any of the company-specific risk be diversified away by investing in both Addtech AB and VARIOUS EATERIES 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 Addtech AB and VARIOUS EATERIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addtech AB and VARIOUS EATERIES LS, you can compare the effects of market volatilities on Addtech AB and VARIOUS EATERIES 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 Addtech AB with a short position of VARIOUS EATERIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addtech AB and VARIOUS EATERIES.
Diversification Opportunities for Addtech AB and VARIOUS EATERIES
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Addtech and VARIOUS is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Addtech AB and VARIOUS EATERIES LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VARIOUS EATERIES and Addtech 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 Addtech AB are associated (or correlated) with VARIOUS EATERIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VARIOUS EATERIES has no effect on the direction of Addtech AB i.e., Addtech AB and VARIOUS EATERIES go up and down completely randomly.
Pair Corralation between Addtech AB and VARIOUS EATERIES
Assuming the 90 days trading horizon Addtech AB is expected to generate 1.59 times more return on investment than VARIOUS EATERIES. However, Addtech AB is 1.59 times more volatile than VARIOUS EATERIES LS. It trades about 0.03 of its potential returns per unit of risk. VARIOUS EATERIES LS is currently generating about -0.23 per unit of risk. If you would invest 2,706 in Addtech AB on November 6, 2024 and sell it today you would earn a total of 72.00 from holding Addtech AB or generate 2.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Addtech AB vs. VARIOUS EATERIES LS
Performance |
| Timeline |
| Addtech AB |
| VARIOUS EATERIES |
Addtech AB and VARIOUS EATERIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addtech AB and VARIOUS EATERIES
The main advantage of trading using opposite Addtech AB and VARIOUS EATERIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addtech AB position performs unexpectedly, VARIOUS EATERIES 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 VARIOUS EATERIES will offset losses from the drop in VARIOUS EATERIES's long position.| Addtech AB vs. SAFEROADS HLDGS | Addtech AB vs. Television Broadcasts Limited | Addtech AB vs. CarsalesCom | Addtech AB vs. MARKET VECTR RETAIL |
| VARIOUS EATERIES vs. CDL INVESTMENT | VARIOUS EATERIES vs. Gladstone Investment | VARIOUS EATERIES vs. Apollo Investment Corp | VARIOUS EATERIES vs. TOREX SEMICONDUCTOR LTD |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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