Correlation Between Careium AB and Enea AB
Can any of the company-specific risk be diversified away by investing in both Careium AB and Enea 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 Careium AB and Enea AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Careium AB and Enea AB, you can compare the effects of market volatilities on Careium AB and Enea 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 Careium AB with a short position of Enea AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Careium AB and Enea AB.
Diversification Opportunities for Careium AB and Enea AB
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Careium and Enea is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Careium AB and Enea AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enea 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 Enea AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enea AB has no effect on the direction of Careium AB i.e., Careium AB and Enea AB go up and down completely randomly.
Pair Corralation between Careium AB and Enea AB
Assuming the 90 days trading horizon Careium AB is expected to under-perform the Enea AB. But the stock apears to be less risky and, when comparing its historical volatility, Careium AB is 1.4 times less risky than Enea AB. The stock trades about -0.09 of its potential returns per unit of risk. The Enea AB is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 9,900 in Enea AB on September 13, 2024 and sell it today you would earn a total of 400.00 from holding Enea AB or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Careium AB vs. Enea AB
Performance |
| Timeline |
| Careium AB |
| Enea AB |
Careium AB and Enea AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Careium AB and Enea AB
The main advantage of trading using opposite Careium AB and Enea AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Careium AB position performs unexpectedly, Enea 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 Enea AB will offset losses from the drop in Enea AB'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 |
| Enea AB vs. Know IT AB | Enea AB vs. Proact IT Group | Enea AB vs. Hexatronic Group AB | Enea AB vs. Inwido 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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