Correlation Between Carlsberg and Carlsberg
Can any of the company-specific risk be diversified away by investing in both Carlsberg and Carlsberg 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 Carlsberg and Carlsberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlsberg AS and Carlsberg AS, you can compare the effects of market volatilities on Carlsberg and Carlsberg 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 Carlsberg with a short position of Carlsberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlsberg and Carlsberg.
Diversification Opportunities for Carlsberg and Carlsberg
Poor diversification
The 3 months correlation between Carlsberg and Carlsberg is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Carlsberg AS and Carlsberg AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlsberg AS and Carlsberg 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 Carlsberg AS are associated (or correlated) with Carlsberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlsberg AS has no effect on the direction of Carlsberg i.e., Carlsberg and Carlsberg go up and down completely randomly.
Pair Corralation between Carlsberg and Carlsberg
Assuming the 90 days trading horizon Carlsberg AS is expected to under-perform the Carlsberg. In addition to that, Carlsberg is 1.04 times more volatile than Carlsberg AS. It trades about -0.29 of its total potential returns per unit of risk. Carlsberg AS is currently generating about -0.17 per unit of volatility. If you would invest 79,080 in Carlsberg AS on August 29, 2024 and sell it today you would lose (5,600) from holding Carlsberg AS or give up 7.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carlsberg AS vs. Carlsberg AS
Performance |
| Timeline |
| Carlsberg AS |
| Carlsberg AS |
Carlsberg and Carlsberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carlsberg and Carlsberg
The main advantage of trading using opposite Carlsberg and Carlsberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlsberg position performs unexpectedly, Carlsberg 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 Carlsberg will offset losses from the drop in Carlsberg's long position.| Carlsberg vs. AP Mller | Carlsberg vs. ROCKWOOL International AS | Carlsberg vs. Royal Unibrew AS | Carlsberg vs. Tryg AS |
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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