Correlation Between Clean Motion and Minesto AB
Can any of the company-specific risk be diversified away by investing in both Clean Motion and Minesto AB 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 Clean Motion and Minesto AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clean Motion AB and Minesto AB, you can compare the effects of market volatilities on Clean Motion and Minesto AB 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 Clean Motion with a short position of Minesto AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Motion and Minesto AB.
Diversification Opportunities for Clean Motion and Minesto AB
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Clean and Minesto is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Clean Motion AB and Minesto AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minesto AB and Clean Motion 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 Clean Motion AB are associated (or correlated) with Minesto AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minesto AB has no effect on the direction of Clean Motion i.e., Clean Motion and Minesto AB go up and down completely randomly.
Pair Corralation between Clean Motion and Minesto AB
Assuming the 90 days trading horizon Clean Motion AB is expected to under-perform the Minesto AB. But the stock apears to be less risky and, when comparing its historical volatility, Clean Motion AB is 1.28 times less risky than Minesto AB. The stock trades about -0.21 of its potential returns per unit of risk. The Minesto AB is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 236.00 in Minesto AB on November 2, 2024 and sell it today you would lose (16.00) from holding Minesto AB or give up 6.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Clean Motion AB vs. Minesto AB
Performance |
| Timeline |
| Clean Motion AB |
| Minesto AB |
Clean Motion and Minesto AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clean Motion and Minesto AB
The main advantage of trading using opposite Clean Motion and Minesto AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean Motion position performs unexpectedly, Minesto AB 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 Minesto AB will offset losses from the drop in Minesto AB's long position.| Clean Motion vs. Doxa AB | Clean Motion vs. Cortus Energy AB | Clean Motion vs. Online Brands Nordic | Clean Motion vs. NetJobs Group AB |
| Minesto AB vs. SolTech Energy Sweden | Minesto AB vs. Eolus Vind AB | Minesto AB vs. Climeon AB | Minesto AB vs. Powercell Sweden |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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