Correlation Between Bonzun AB and RaySearch Laboratories
Can any of the company-specific risk be diversified away by investing in both Bonzun AB and RaySearch Laboratories 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 Bonzun AB and RaySearch Laboratories into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bonzun AB and RaySearch Laboratories AB, you can compare the effects of market volatilities on Bonzun AB and RaySearch Laboratories 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 Bonzun AB with a short position of RaySearch Laboratories. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bonzun AB and RaySearch Laboratories.
Diversification Opportunities for Bonzun AB and RaySearch Laboratories
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bonzun and RaySearch is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Bonzun AB and RaySearch Laboratories AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RaySearch Laboratories and Bonzun 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 Bonzun AB are associated (or correlated) with RaySearch Laboratories. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RaySearch Laboratories has no effect on the direction of Bonzun AB i.e., Bonzun AB and RaySearch Laboratories go up and down completely randomly.
Pair Corralation between Bonzun AB and RaySearch Laboratories
Assuming the 90 days trading horizon Bonzun AB is expected to under-perform the RaySearch Laboratories. In addition to that, Bonzun AB is 3.82 times more volatile than RaySearch Laboratories AB. It trades about -0.02 of its total potential returns per unit of risk. RaySearch Laboratories AB is currently generating about 0.13 per unit of volatility. If you would invest 8,246 in RaySearch Laboratories AB on August 26, 2024 and sell it today you would earn a total of 11,754 from holding RaySearch Laboratories AB or generate 142.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bonzun AB vs. RaySearch Laboratories AB
Performance |
| Timeline |
| Bonzun AB |
| RaySearch Laboratories |
Bonzun AB and RaySearch Laboratories Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bonzun AB and RaySearch Laboratories
The main advantage of trading using opposite Bonzun AB and RaySearch Laboratories positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bonzun AB position performs unexpectedly, RaySearch Laboratories 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 RaySearch Laboratories will offset losses from the drop in RaySearch Laboratories' long position.| Bonzun AB vs. Enersize Oy | Bonzun AB vs. Diagonal Bio AB | Bonzun AB vs. NetJobs Group AB | Bonzun AB vs. Clean Motion AB |
| RaySearch Laboratories vs. Elekta AB | RaySearch Laboratories vs. Vitrolife AB | RaySearch Laboratories vs. CellaVision AB | RaySearch Laboratories vs. Probi 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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