Correlation Between Cloetta AB and Arctic Gold
Can any of the company-specific risk be diversified away by investing in both Cloetta AB and Arctic Gold 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 Arctic Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloetta AB and Arctic Gold Publ, you can compare the effects of market volatilities on Cloetta AB and Arctic Gold 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 Arctic Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloetta AB and Arctic Gold.
Diversification Opportunities for Cloetta AB and Arctic Gold
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cloetta and Arctic is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Cloetta AB and Arctic Gold Publ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arctic Gold Publ 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 Arctic Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arctic Gold Publ has no effect on the direction of Cloetta AB i.e., Cloetta AB and Arctic Gold go up and down completely randomly.
Pair Corralation between Cloetta AB and Arctic Gold
Assuming the 90 days trading horizon Cloetta AB is expected to generate 0.25 times more return on investment than Arctic Gold. However, Cloetta AB is 3.96 times less risky than Arctic Gold. It trades about 0.16 of its potential returns per unit of risk. Arctic Gold Publ is currently generating about 0.01 per unit of risk. If you would invest 1,972 in Cloetta AB on September 1, 2024 and sell it today you would earn a total of 630.00 from holding Cloetta AB or generate 31.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cloetta AB vs. Arctic Gold Publ
Performance |
| Timeline |
| Cloetta AB |
| Arctic Gold Publ |
Cloetta AB and Arctic Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloetta AB and Arctic Gold
The main advantage of trading using opposite Cloetta AB and Arctic Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloetta AB position performs unexpectedly, Arctic Gold 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 Arctic Gold will offset losses from the drop in Arctic Gold'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 |
| Arctic Gold vs. Holmen AB | Arctic Gold vs. Svenska Cellulosa Aktiebolaget | Arctic Gold vs. Husqvarna AB | Arctic Gold vs. Alfa Laval 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |