Correlation Between Bure Equity and Resurs Holding
Can any of the company-specific risk be diversified away by investing in both Bure Equity and Resurs Holding 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 Resurs Holding 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 Resurs Holding AB, you can compare the effects of market volatilities on Bure Equity and Resurs Holding 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 Resurs Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bure Equity and Resurs Holding.
Diversification Opportunities for Bure Equity and Resurs Holding
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bure and Resurs is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Bure Equity AB and Resurs Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Resurs Holding 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 Resurs Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Resurs Holding AB has no effect on the direction of Bure Equity i.e., Bure Equity and Resurs Holding go up and down completely randomly.
Pair Corralation between Bure Equity and Resurs Holding
Assuming the 90 days trading horizon Bure Equity AB is expected to under-perform the Resurs Holding. In addition to that, Bure Equity is 11.57 times more volatile than Resurs Holding AB. It trades about -0.14 of its total potential returns per unit of risk. Resurs Holding AB is currently generating about 0.25 per unit of volatility. If you would invest 2,350 in Resurs Holding AB on November 28, 2024 and sell it today you would earn a total of 20.00 from holding Resurs Holding AB or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bure Equity AB vs. Resurs Holding AB
Performance |
| Timeline |
| Bure Equity AB |
| Resurs Holding AB |
Bure Equity and Resurs Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bure Equity and Resurs Holding
The main advantage of trading using opposite Bure Equity and Resurs Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bure Equity position performs unexpectedly, Resurs Holding 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 Resurs Holding will offset losses from the drop in Resurs Holding'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 |
| Resurs Holding vs. Intrum Justitia AB | Resurs Holding vs. Tele2 AB | Resurs Holding vs. Telia Company AB | Resurs Holding vs. Axfood 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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