Correlation Between Bambuser and Sinch AB
Can any of the company-specific risk be diversified away by investing in both Bambuser and Sinch 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 Bambuser and Sinch AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bambuser AB and Sinch AB, you can compare the effects of market volatilities on Bambuser and Sinch 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 Bambuser with a short position of Sinch AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bambuser and Sinch AB.
Diversification Opportunities for Bambuser and Sinch AB
Poor diversification
The 3 months correlation between Bambuser and Sinch is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Bambuser AB and Sinch AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinch AB and Bambuser 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 Bambuser AB are associated (or correlated) with Sinch AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinch AB has no effect on the direction of Bambuser i.e., Bambuser and Sinch AB go up and down completely randomly.
Pair Corralation between Bambuser and Sinch AB
Assuming the 90 days trading horizon Bambuser AB is expected to generate 1.0 times more return on investment than Sinch AB. However, Bambuser is 1.0 times more volatile than Sinch AB. It trades about -0.22 of its potential returns per unit of risk. Sinch AB is currently generating about -0.23 per unit of risk. If you would invest 85.00 in Bambuser AB on August 25, 2024 and sell it today you would lose (27.00) from holding Bambuser AB or give up 31.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bambuser AB vs. Sinch AB
Performance |
| Timeline |
| Bambuser AB |
| Sinch AB |
Bambuser and Sinch AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bambuser and Sinch AB
The main advantage of trading using opposite Bambuser and Sinch AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bambuser position performs unexpectedly, Sinch 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 Sinch AB will offset losses from the drop in Sinch AB's long position.| Bambuser vs. Spectrumone publ AB | Bambuser vs. Media and Games | Bambuser vs. Enersize Oy | Bambuser vs. Cantargia AB |
| Sinch AB vs. Lidds AB | Sinch AB vs. Serstech AB | Sinch AB vs. Transtema Group AB | Sinch AB vs. Enorama Pharma 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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