Correlation Between Cell Impact and Humble Group
Can any of the company-specific risk be diversified away by investing in both Cell Impact and Humble Group 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 Cell Impact and Humble Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cell Impact AB and Humble Group AB, you can compare the effects of market volatilities on Cell Impact and Humble Group 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 Cell Impact with a short position of Humble Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cell Impact and Humble Group.
Diversification Opportunities for Cell Impact and Humble Group
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cell and Humble is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Cell Impact AB and Humble Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humble Group AB and Cell Impact 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 Cell Impact AB are associated (or correlated) with Humble Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humble Group AB has no effect on the direction of Cell Impact i.e., Cell Impact and Humble Group go up and down completely randomly.
Pair Corralation between Cell Impact and Humble Group
Assuming the 90 days horizon Cell Impact AB is expected to under-perform the Humble Group. In addition to that, Cell Impact is 1.41 times more volatile than Humble Group AB. It trades about -0.25 of its total potential returns per unit of risk. Humble Group AB is currently generating about 0.26 per unit of volatility. If you would invest 1,038 in Humble Group AB on September 24, 2024 and sell it today you would earn a total of 179.00 from holding Humble Group AB or generate 17.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cell Impact AB vs. Humble Group AB
Performance |
| Timeline |
| Cell Impact AB |
| Humble Group AB |
Cell Impact and Humble Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cell Impact and Humble Group
The main advantage of trading using opposite Cell Impact and Humble Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cell Impact position performs unexpectedly, Humble Group 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 Humble Group will offset losses from the drop in Humble Group's long position.| Cell Impact vs. Humble Group AB | Cell Impact vs. Enad Global 7 | Cell Impact vs. Goodbye Kansas Group | Cell Impact vs. Mekonomen AB |
| Humble Group vs. Samhllsbyggnadsbolaget i Norden | Humble Group vs. Media and Games | Humble Group vs. Hexatronic Group AB | Humble Group vs. Sinch 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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