Correlation Between Cloetta AB and AcadeMedia
Can any of the company-specific risk be diversified away by investing in both Cloetta AB and AcadeMedia 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 Cloetta AB and AcadeMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloetta AB and AcadeMedia AB, you can compare the effects of market volatilities on Cloetta AB and AcadeMedia 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 Cloetta AB with a short position of AcadeMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloetta AB and AcadeMedia.
Diversification Opportunities for Cloetta AB and AcadeMedia
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cloetta and AcadeMedia is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Cloetta AB and AcadeMedia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AcadeMedia AB and Cloetta 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 Cloetta AB are associated (or correlated) with AcadeMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AcadeMedia AB has no effect on the direction of Cloetta AB i.e., Cloetta AB and AcadeMedia go up and down completely randomly.
Pair Corralation between Cloetta AB and AcadeMedia
Assuming the 90 days trading horizon Cloetta AB is expected to generate 0.9 times more return on investment than AcadeMedia. However, Cloetta AB is 1.12 times less risky than AcadeMedia. It trades about 0.14 of its potential returns per unit of risk. AcadeMedia AB is currently generating about 0.06 per unit of risk. If you would invest 1,699 in Cloetta AB on September 3, 2024 and sell it today you would earn a total of 923.00 from holding Cloetta AB or generate 54.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cloetta AB vs. AcadeMedia AB
Performance |
| Timeline |
| Cloetta AB |
| AcadeMedia AB |
Cloetta AB and AcadeMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloetta AB and AcadeMedia
The main advantage of trading using opposite Cloetta AB and AcadeMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloetta AB position performs unexpectedly, AcadeMedia 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 AcadeMedia will offset losses from the drop in AcadeMedia's long position.| Cloetta AB vs. Securitas AB | Cloetta AB vs. Clas Ohlson AB | Cloetta AB vs. Axfood AB | Cloetta AB vs. Byggmax Group AB |
| AcadeMedia vs. Inwido AB | AcadeMedia vs. Alimak Hek Group | AcadeMedia vs. Dometic Group AB | AcadeMedia vs. Byggmax Group 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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