Correlation Between COMBA TELECOM and AP Møller
Can any of the company-specific risk be diversified away by investing in both COMBA TELECOM and AP Møller 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 COMBA TELECOM and AP Møller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMBA TELECOM SYST and AP Mller , you can compare the effects of market volatilities on COMBA TELECOM and AP Møller 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 COMBA TELECOM with a short position of AP Møller. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMBA TELECOM and AP Møller.
Diversification Opportunities for COMBA TELECOM and AP Møller
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between COMBA and DP4B is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding COMBA TELECOM SYST and AP Mller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Møller and COMBA TELECOM 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 COMBA TELECOM SYST are associated (or correlated) with AP Møller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Møller has no effect on the direction of COMBA TELECOM i.e., COMBA TELECOM and AP Møller go up and down completely randomly.
Pair Corralation between COMBA TELECOM and AP Møller
Assuming the 90 days trading horizon COMBA TELECOM SYST is expected to generate 0.83 times more return on investment than AP Møller. However, COMBA TELECOM SYST is 1.21 times less risky than AP Møller. It trades about 0.21 of its potential returns per unit of risk. AP Mller is currently generating about 0.03 per unit of risk. If you would invest 12.00 in COMBA TELECOM SYST on September 15, 2024 and sell it today you would earn a total of 1.00 from holding COMBA TELECOM SYST or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMBA TELECOM SYST vs. AP Mller
Performance |
| Timeline |
| COMBA TELECOM SYST |
| AP Møller |
COMBA TELECOM and AP Møller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMBA TELECOM and AP Møller
The main advantage of trading using opposite COMBA TELECOM and AP Møller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMBA TELECOM position performs unexpectedly, AP Møller 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 AP Møller will offset losses from the drop in AP Møller's long position.| COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Apple Inc | COMBA TELECOM vs. Apple Inc |
| AP Møller vs. CSSC Offshore Marine | AP Møller vs. Charter Communications | AP Møller vs. COMBA TELECOM SYST | AP Møller vs. Consolidated Communications Holdings |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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