Correlation Between Bergman Beving and Momentum Group
Can any of the company-specific risk be diversified away by investing in both Bergman Beving and Momentum Group 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 Bergman Beving and Momentum Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bergman Beving AB and Momentum Group AB, you can compare the effects of market volatilities on Bergman Beving and Momentum Group 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 Bergman Beving with a short position of Momentum Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bergman Beving and Momentum Group.
Diversification Opportunities for Bergman Beving and Momentum Group
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bergman and Momentum is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Bergman Beving AB and Momentum Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Momentum Group AB and Bergman Beving 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 Bergman Beving AB are associated (or correlated) with Momentum Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Momentum Group AB has no effect on the direction of Bergman Beving i.e., Bergman Beving and Momentum Group go up and down completely randomly.
Pair Corralation between Bergman Beving and Momentum Group
Assuming the 90 days trading horizon Bergman Beving is expected to generate 1.15 times less return on investment than Momentum Group. But when comparing it to its historical volatility, Bergman Beving AB is 1.38 times less risky than Momentum Group. It trades about 0.11 of its potential returns per unit of risk. Momentum Group AB is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 5,591 in Momentum Group AB on August 24, 2024 and sell it today you would earn a total of 11,469 from holding Momentum Group AB or generate 205.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bergman Beving AB vs. Momentum Group AB
Performance |
| Timeline |
| Bergman Beving AB |
| Momentum Group AB |
Bergman Beving and Momentum Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bergman Beving and Momentum Group
The main advantage of trading using opposite Bergman Beving and Momentum Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bergman Beving position performs unexpectedly, Momentum Group 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 Momentum Group will offset losses from the drop in Momentum Group's long position.| Bergman Beving vs. Lagercrantz Group AB | Bergman Beving vs. Addtech AB | Bergman Beving vs. AddLife AB | Bergman Beving vs. Bufab Holding AB |
| Momentum Group vs. Bergman Beving AB | Momentum Group vs. Lagercrantz Group AB | Momentum Group vs. AddLife AB | Momentum Group vs. Addtech 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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