Correlation Between Beijer Alma and Duni AB
Can any of the company-specific risk be diversified away by investing in both Beijer Alma and Duni AB 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 Beijer Alma and Duni AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beijer Alma AB and Duni AB, you can compare the effects of market volatilities on Beijer Alma and Duni AB 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 Beijer Alma with a short position of Duni AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijer Alma and Duni AB.
Diversification Opportunities for Beijer Alma and Duni AB
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijer and Duni is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Beijer Alma AB and Duni AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duni AB and Beijer Alma 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 Beijer Alma AB are associated (or correlated) with Duni AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duni AB has no effect on the direction of Beijer Alma i.e., Beijer Alma and Duni AB go up and down completely randomly.
Pair Corralation between Beijer Alma and Duni AB
Assuming the 90 days trading horizon Beijer Alma AB is expected to generate 1.43 times more return on investment than Duni AB. However, Beijer Alma is 1.43 times more volatile than Duni AB. It trades about -0.01 of its potential returns per unit of risk. Duni AB is currently generating about -0.05 per unit of risk. If you would invest 18,003 in Beijer Alma AB on August 28, 2024 and sell it today you would lose (1,303) from holding Beijer Alma AB or give up 7.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijer Alma AB vs. Duni AB
Performance |
| Timeline |
| Beijer Alma AB |
| Duni AB |
Beijer Alma and Duni AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijer Alma and Duni AB
The main advantage of trading using opposite Beijer Alma and Duni AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijer Alma position performs unexpectedly, Duni AB 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 Duni AB will offset losses from the drop in Duni AB's long position.| Beijer Alma vs. Lagercrantz Group AB | Beijer Alma vs. Addtech AB | Beijer Alma vs. AddLife AB | Beijer Alma vs. Bufab Holding 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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