Correlation Between Addtech AB and CAIXABANK UNADR
Can any of the company-specific risk be diversified away by investing in both Addtech AB and CAIXABANK UNADR 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 CAIXABANK UNADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addtech AB and CAIXABANK UNADR 13, you can compare the effects of market volatilities on Addtech AB and CAIXABANK UNADR 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 CAIXABANK UNADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addtech AB and CAIXABANK UNADR.
Diversification Opportunities for Addtech AB and CAIXABANK UNADR
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Addtech and CAIXABANK is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Addtech AB and CAIXABANK UNADR 13 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAIXABANK UNADR 13 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 CAIXABANK UNADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAIXABANK UNADR 13 has no effect on the direction of Addtech AB i.e., Addtech AB and CAIXABANK UNADR go up and down completely randomly.
Pair Corralation between Addtech AB and CAIXABANK UNADR
Assuming the 90 days trading horizon Addtech AB is expected to generate 1.09 times more return on investment than CAIXABANK UNADR. However, Addtech AB is 1.09 times more volatile than CAIXABANK UNADR 13. It trades about 0.08 of its potential returns per unit of risk. CAIXABANK UNADR 13 is currently generating about 0.06 per unit of risk. If you would invest 1,253 in Addtech AB on November 1, 2024 and sell it today you would earn a total of 1,505 from holding Addtech AB or generate 120.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Addtech AB vs. CAIXABANK UNADR 13
Performance |
| Timeline |
| Addtech AB |
| CAIXABANK UNADR 13 |
Addtech AB and CAIXABANK UNADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addtech AB and CAIXABANK UNADR
The main advantage of trading using opposite Addtech AB and CAIXABANK UNADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addtech AB position performs unexpectedly, CAIXABANK UNADR 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 CAIXABANK UNADR will offset losses from the drop in CAIXABANK UNADR's long position.| Addtech AB vs. Fastenal Company | Addtech AB vs. Indutrade AB | Addtech AB vs. Superior Plus Corp | Addtech AB vs. Origin Agritech |
| CAIXABANK UNADR vs. POSBO UNSPADRS20YC1 | CAIXABANK UNADR vs. Postal Savings Bank | CAIXABANK UNADR vs. Truist Financial | CAIXABANK UNADR vs. OVERSEA CHINUNSPADR2 |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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