Correlation Between Careium AB and CellaVision
Can any of the company-specific risk be diversified away by investing in both Careium AB and CellaVision 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 Careium AB and CellaVision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Careium AB and CellaVision AB, you can compare the effects of market volatilities on Careium AB and CellaVision 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 Careium AB with a short position of CellaVision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Careium AB and CellaVision.
Diversification Opportunities for Careium AB and CellaVision
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Careium and CellaVision is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Careium AB and CellaVision AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CellaVision AB and Careium 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 Careium AB are associated (or correlated) with CellaVision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CellaVision AB has no effect on the direction of Careium AB i.e., Careium AB and CellaVision go up and down completely randomly.
Pair Corralation between Careium AB and CellaVision
Assuming the 90 days trading horizon Careium AB is expected to generate 0.59 times more return on investment than CellaVision. However, Careium AB is 1.69 times less risky than CellaVision. It trades about -0.09 of its potential returns per unit of risk. CellaVision AB is currently generating about -0.13 per unit of risk. If you would invest 3,040 in Careium AB on September 13, 2024 and sell it today you would lose (90.00) from holding Careium AB or give up 2.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Careium AB vs. CellaVision AB
Performance |
| Timeline |
| Careium AB |
| CellaVision AB |
Careium AB and CellaVision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Careium AB and CellaVision
The main advantage of trading using opposite Careium AB and CellaVision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Careium AB position performs unexpectedly, CellaVision 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 CellaVision will offset losses from the drop in CellaVision's long position.| Careium AB vs. Humble Group AB | Careium AB vs. Enad Global 7 | Careium AB vs. Goodbye Kansas Group | Careium AB vs. KABE Group AB |
| CellaVision vs. Mendus AB | CellaVision vs. Cantargia AB | CellaVision vs. BioInvent International AB | CellaVision vs. Isofol Medical 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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