Correlation Between Doxa AB and Momentum Group
Can any of the company-specific risk be diversified away by investing in both Doxa AB and Momentum Group 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 Doxa AB and Momentum Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doxa AB and Momentum Group AB, you can compare the effects of market volatilities on Doxa AB and Momentum Group 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 Doxa AB with a short position of Momentum Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doxa AB and Momentum Group.
Diversification Opportunities for Doxa AB and Momentum Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Doxa and Momentum is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Doxa AB and Momentum Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Momentum Group AB and Doxa 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 Doxa AB are associated (or correlated) with Momentum Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Momentum Group AB has no effect on the direction of Doxa AB i.e., Doxa AB and Momentum Group go up and down completely randomly.
Pair Corralation between Doxa AB and Momentum Group
Assuming the 90 days trading horizon Doxa AB is expected to under-perform the Momentum Group. But the stock apears to be less risky and, when comparing its historical volatility, Doxa AB is 1.39 times less risky than Momentum Group. The stock trades about -0.18 of its potential returns per unit of risk. The Momentum Group AB is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 17,000 in Momentum Group AB on August 24, 2024 and sell it today you would earn a total of 60.00 from holding Momentum Group AB or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doxa AB vs. Momentum Group AB
Performance |
| Timeline |
| Doxa AB |
| Momentum Group AB |
Doxa AB and Momentum Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doxa AB and Momentum Group
The main advantage of trading using opposite Doxa AB and Momentum Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doxa AB position performs unexpectedly, Momentum Group 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 Momentum Group will offset losses from the drop in Momentum Group's long position.The idea behind Doxa AB and Momentum Group AB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Momentum Group vs. Bergman Beving AB | Momentum Group vs. Lagercrantz Group AB | Momentum Group vs. AddLife AB | Momentum Group vs. Addtech 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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