Correlation Between Dios Fastigheter and Catena AB
Can any of the company-specific risk be diversified away by investing in both Dios Fastigheter and Catena 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 Dios Fastigheter and Catena AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dios Fastigheter AB and Catena AB, you can compare the effects of market volatilities on Dios Fastigheter and Catena 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 Dios Fastigheter with a short position of Catena AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dios Fastigheter and Catena AB.
Diversification Opportunities for Dios Fastigheter and Catena AB
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dios and Catena is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Dios Fastigheter AB and Catena AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catena AB and Dios Fastigheter 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 Dios Fastigheter AB are associated (or correlated) with Catena AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catena AB has no effect on the direction of Dios Fastigheter i.e., Dios Fastigheter and Catena AB go up and down completely randomly.
Pair Corralation between Dios Fastigheter and Catena AB
Assuming the 90 days trading horizon Dios Fastigheter is expected to generate 2.05 times less return on investment than Catena AB. In addition to that, Dios Fastigheter is 1.08 times more volatile than Catena AB. It trades about 0.01 of its total potential returns per unit of risk. Catena AB is currently generating about 0.03 per unit of volatility. If you would invest 39,457 in Catena AB on August 31, 2024 and sell it today you would earn a total of 9,243 from holding Catena AB or generate 23.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Dios Fastigheter AB vs. Catena AB
Performance |
| Timeline |
| Dios Fastigheter |
| Catena AB |
Dios Fastigheter and Catena AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dios Fastigheter and Catena AB
The main advantage of trading using opposite Dios Fastigheter and Catena AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dios Fastigheter position performs unexpectedly, Catena 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 Catena AB will offset losses from the drop in Catena AB's long position.| Dios Fastigheter vs. Fabege AB | Dios Fastigheter vs. Wihlborgs Fastigheter AB | Dios Fastigheter vs. Castellum AB | Dios Fastigheter vs. Fastighets AB Balder |
| Catena AB vs. Fastighets AB Balder | Catena AB vs. Fabege AB | Catena AB vs. Wihlborgs Fastigheter AB | Catena AB vs. AB Sagax |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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