Correlation Between Bong AB and Eniro AB
Can any of the company-specific risk be diversified away by investing in both Bong AB and Eniro 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 Bong AB and Eniro AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bong AB and Eniro AB, you can compare the effects of market volatilities on Bong AB and Eniro 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 Bong AB with a short position of Eniro AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bong AB and Eniro AB.
Diversification Opportunities for Bong AB and Eniro AB
Good diversification
The 3 months correlation between Bong and Eniro is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bong AB and Eniro AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eniro AB and Bong 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 Bong AB are associated (or correlated) with Eniro AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eniro AB has no effect on the direction of Bong AB i.e., Bong AB and Eniro AB go up and down completely randomly.
Pair Corralation between Bong AB and Eniro AB
Assuming the 90 days trading horizon Bong AB is expected to under-perform the Eniro AB. But the stock apears to be less risky and, when comparing its historical volatility, Bong AB is 1.2 times less risky than Eniro AB. The stock trades about -0.11 of its potential returns per unit of risk. The Eniro AB is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 44.00 in Eniro AB on August 26, 2024 and sell it today you would earn a total of 2.00 from holding Eniro AB or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bong AB vs. Eniro AB
Performance |
| Timeline |
| Bong AB |
| Eniro AB |
Bong AB and Eniro AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bong AB and Eniro AB
The main advantage of trading using opposite Bong AB and Eniro AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bong AB position performs unexpectedly, Eniro 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 Eniro AB will offset losses from the drop in Eniro AB's long position.| Bong AB vs. Anoto Group AB | Bong AB vs. CTT Systems AB | Bong AB vs. Bjorn Borg AB | Bong AB vs. Mekonomen AB |
| Eniro AB vs. Alfa Laval AB | Eniro AB vs. Anoto Group AB | Eniro AB vs. Active Biotech AB | Eniro AB vs. BioInvent International 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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