Correlation Between Bure Equity and Ratos AB
Can any of the company-specific risk be diversified away by investing in both Bure Equity and Ratos 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 Bure Equity and Ratos AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bure Equity AB and Ratos AB, you can compare the effects of market volatilities on Bure Equity and Ratos 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 Bure Equity with a short position of Ratos AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bure Equity and Ratos AB.
Diversification Opportunities for Bure Equity and Ratos AB
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bure and Ratos is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Bure Equity AB and Ratos AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ratos AB and Bure Equity 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 Bure Equity AB are associated (or correlated) with Ratos AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ratos AB has no effect on the direction of Bure Equity i.e., Bure Equity and Ratos AB go up and down completely randomly.
Pair Corralation between Bure Equity and Ratos AB
Assuming the 90 days trading horizon Bure Equity AB is expected to generate 0.86 times more return on investment than Ratos AB. However, Bure Equity AB is 1.16 times less risky than Ratos AB. It trades about 0.09 of its potential returns per unit of risk. Ratos AB is currently generating about 0.0 per unit of risk. If you would invest 28,086 in Bure Equity AB on September 12, 2024 and sell it today you would earn a total of 10,694 from holding Bure Equity AB or generate 38.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bure Equity AB vs. Ratos AB
Performance |
| Timeline |
| Bure Equity AB |
| Ratos AB |
Bure Equity and Ratos AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bure Equity and Ratos AB
The main advantage of trading using opposite Bure Equity and Ratos AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bure Equity position performs unexpectedly, Ratos 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 Ratos AB will offset losses from the drop in Ratos AB's long position.| Bure Equity vs. Investment AB Latour | Bure Equity vs. Kinnevik Investment AB | Bure Equity vs. Svolder AB | Bure Equity vs. Creades AB |
| Ratos AB vs. Catella AB | Ratos AB vs. Catella AB A | Ratos AB vs. KABE Group AB | Ratos AB vs. IAR Systems Group |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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