Correlation Between Bjorn Borg and Cloetta AB
Can any of the company-specific risk be diversified away by investing in both Bjorn Borg and Cloetta 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 Bjorn Borg and Cloetta AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bjorn Borg AB and Cloetta AB, you can compare the effects of market volatilities on Bjorn Borg and Cloetta 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 Bjorn Borg with a short position of Cloetta AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bjorn Borg and Cloetta AB.
Diversification Opportunities for Bjorn Borg and Cloetta AB
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bjorn and Cloetta is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Bjorn Borg AB and Cloetta AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloetta AB and Bjorn Borg 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 Bjorn Borg AB are associated (or correlated) with Cloetta AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloetta AB has no effect on the direction of Bjorn Borg i.e., Bjorn Borg and Cloetta AB go up and down completely randomly.
Pair Corralation between Bjorn Borg and Cloetta AB
Assuming the 90 days trading horizon Bjorn Borg AB is expected to generate 2.17 times more return on investment than Cloetta AB. However, Bjorn Borg is 2.17 times more volatile than Cloetta AB. It trades about -0.06 of its potential returns per unit of risk. Cloetta AB is currently generating about -0.22 per unit of risk. If you would invest 5,678 in Bjorn Borg AB on August 28, 2024 and sell it today you would lose (177.00) from holding Bjorn Borg AB or give up 3.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bjorn Borg AB vs. Cloetta AB
Performance |
| Timeline |
| Bjorn Borg AB |
| Cloetta AB |
Bjorn Borg and Cloetta AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bjorn Borg and Cloetta AB
The main advantage of trading using opposite Bjorn Borg and Cloetta AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bjorn Borg position performs unexpectedly, Cloetta 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 Cloetta AB will offset losses from the drop in Cloetta AB's long position.| Bjorn Borg vs. New Wave Group | Bjorn Borg vs. Clas Ohlson AB | Bjorn Borg vs. BE Group AB | Bjorn Borg vs. Betsson AB |
| Cloetta AB vs. Securitas AB | Cloetta AB vs. Clas Ohlson AB | Cloetta AB vs. Axfood AB | Cloetta AB vs. Byggmax Group 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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