Correlation Between BE Group and TradeDoubler
Can any of the company-specific risk be diversified away by investing in both BE Group 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 BE Group and TradeDoubler into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BE Group AB and TradeDoubler AB, you can compare the effects of market volatilities on BE Group 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 BE Group with a short position of TradeDoubler. Check out your portfolio center. Please also check ongoing floating volatility patterns of BE Group and TradeDoubler.
Diversification Opportunities for BE Group and TradeDoubler
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BEGR and TradeDoubler is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding BE Group AB and TradeDoubler AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TradeDoubler AB and BE Group 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 BE Group 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 BE Group i.e., BE Group and TradeDoubler go up and down completely randomly.
Pair Corralation between BE Group and TradeDoubler
Assuming the 90 days trading horizon BE Group is expected to generate 8.94 times less return on investment than TradeDoubler. But when comparing it to its historical volatility, BE Group AB is 2.71 times less risky than TradeDoubler. It trades about 0.1 of its potential returns per unit of risk. TradeDoubler AB is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 357.00 in TradeDoubler AB on December 1, 2024 and sell it today you would earn a total of 193.00 from holding TradeDoubler AB or generate 54.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BE Group AB vs. TradeDoubler AB
Performance |
| Timeline |
| BE Group AB |
| TradeDoubler AB |
BE Group and TradeDoubler Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BE Group and TradeDoubler
The main advantage of trading using opposite BE Group and TradeDoubler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BE Group 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.| BE Group vs. Bjorn Borg AB | BE Group vs. BioInvent International AB | BE Group vs. Lindab International AB | BE Group vs. Clas Ohlson 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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