Correlation Between Cloetta AB and Online Brands
Can any of the company-specific risk be diversified away by investing in both Cloetta AB and Online Brands 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 Online Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloetta AB and Online Brands Nordic, you can compare the effects of market volatilities on Cloetta AB and Online Brands 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 Online Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloetta AB and Online Brands.
Diversification Opportunities for Cloetta AB and Online Brands
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cloetta and Online is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Cloetta AB and Online Brands Nordic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Online Brands Nordic 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 Online Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Online Brands Nordic has no effect on the direction of Cloetta AB i.e., Cloetta AB and Online Brands go up and down completely randomly.
Pair Corralation between Cloetta AB and Online Brands
Assuming the 90 days trading horizon Cloetta AB is expected to generate 0.28 times more return on investment than Online Brands. However, Cloetta AB is 3.55 times less risky than Online Brands. It trades about 0.04 of its potential returns per unit of risk. Online Brands Nordic is currently generating about 0.0 per unit of risk. If you would invest 2,011 in Cloetta AB on October 24, 2024 and sell it today you would earn a total of 469.00 from holding Cloetta AB or generate 23.32% 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. Online Brands Nordic
Performance |
| Timeline |
| Cloetta AB |
| Online Brands Nordic |
Cloetta AB and Online Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloetta AB and Online Brands
The main advantage of trading using opposite Cloetta AB and Online Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloetta AB position performs unexpectedly, Online Brands 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 Online Brands will offset losses from the drop in Online Brands' long position.| Cloetta AB vs. Securitas AB | Cloetta AB vs. Clas Ohlson AB | Cloetta AB vs. Axfood AB | Cloetta AB vs. Byggmax Group AB |
| Online Brands vs. Cloetta AB | Online Brands vs. Inwido AB | Online Brands vs. Fagerhult AB | Online Brands vs. Beijer Alma 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 Stocks Directory module to find actively traded stocks across global markets.
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