Correlation Between Addtech AB and Atrium Ljungberg
Can any of the company-specific risk be diversified away by investing in both Addtech AB and Atrium Ljungberg 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 Atrium Ljungberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addtech AB and Atrium Ljungberg AB, you can compare the effects of market volatilities on Addtech AB and Atrium Ljungberg 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 Atrium Ljungberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addtech AB and Atrium Ljungberg.
Diversification Opportunities for Addtech AB and Atrium Ljungberg
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Addtech and Atrium is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Addtech AB and Atrium Ljungberg AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atrium Ljungberg 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 Atrium Ljungberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atrium Ljungberg has no effect on the direction of Addtech AB i.e., Addtech AB and Atrium Ljungberg go up and down completely randomly.
Pair Corralation between Addtech AB and Atrium Ljungberg
Assuming the 90 days trading horizon Addtech AB is expected to generate 0.86 times more return on investment than Atrium Ljungberg. However, Addtech AB is 1.17 times less risky than Atrium Ljungberg. It trades about 0.12 of its potential returns per unit of risk. Atrium Ljungberg AB is currently generating about -0.04 per unit of risk. If you would invest 2,654 in Addtech AB on November 6, 2024 and sell it today you would earn a total of 124.00 from holding Addtech AB or generate 4.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Addtech AB vs. Atrium Ljungberg AB
Performance |
| Timeline |
| Addtech AB |
| Atrium Ljungberg |
Addtech AB and Atrium Ljungberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addtech AB and Atrium Ljungberg
The main advantage of trading using opposite Addtech AB and Atrium Ljungberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addtech AB position performs unexpectedly, Atrium Ljungberg 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 Atrium Ljungberg will offset losses from the drop in Atrium Ljungberg's long position.| Addtech AB vs. SAFEROADS HLDGS | Addtech AB vs. Television Broadcasts Limited | Addtech AB vs. CarsalesCom | Addtech AB vs. MARKET VECTR RETAIL |
| Atrium Ljungberg vs. China Resources Land | Atrium Ljungberg vs. SEAZEN GROUP LTD | Atrium Ljungberg vs. GANGLONG CHINA PRGRLTD |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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