Correlation Between CDON AB and Bambuser
Can any of the company-specific risk be diversified away by investing in both CDON AB and Bambuser 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 CDON AB and Bambuser into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDON AB and Bambuser AB, you can compare the effects of market volatilities on CDON AB and Bambuser 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 CDON AB with a short position of Bambuser. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDON AB and Bambuser.
Diversification Opportunities for CDON AB and Bambuser
Excellent diversification
The 3 months correlation between CDON and Bambuser is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding CDON AB and Bambuser AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bambuser AB and CDON 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 CDON AB are associated (or correlated) with Bambuser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bambuser AB has no effect on the direction of CDON AB i.e., CDON AB and Bambuser go up and down completely randomly.
Pair Corralation between CDON AB and Bambuser
Assuming the 90 days trading horizon CDON AB is expected to generate 0.25 times more return on investment than Bambuser. However, CDON AB is 3.95 times less risky than Bambuser. It trades about -0.02 of its potential returns per unit of risk. Bambuser AB is currently generating about -0.05 per unit of risk. If you would invest 9,720 in CDON AB on September 1, 2024 and sell it today you would lose (100.00) from holding CDON AB or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CDON AB vs. Bambuser AB
Performance |
| Timeline |
| CDON AB |
| Bambuser AB |
CDON AB and Bambuser Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDON AB and Bambuser
The main advantage of trading using opposite CDON AB and Bambuser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDON AB position performs unexpectedly, Bambuser 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 Bambuser will offset losses from the drop in Bambuser's long position.| CDON AB vs. AstraZeneca PLC | CDON AB vs. Investor AB ser | CDON AB vs. Investor AB ser | CDON AB vs. Atlas Copco 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |