Correlation Between Elektroimportoren and Europris ASA
Can any of the company-specific risk be diversified away by investing in both Elektroimportoren and Europris ASA 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 Elektroimportoren and Europris ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elektroimportoren As and Europris ASA, you can compare the effects of market volatilities on Elektroimportoren and Europris ASA 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 Elektroimportoren with a short position of Europris ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elektroimportoren and Europris ASA.
Diversification Opportunities for Elektroimportoren and Europris ASA
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Elektroimportoren and Europris is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Elektroimportoren As and Europris ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Europris ASA and Elektroimportoren 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 Elektroimportoren As are associated (or correlated) with Europris ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Europris ASA has no effect on the direction of Elektroimportoren i.e., Elektroimportoren and Europris ASA go up and down completely randomly.
Pair Corralation between Elektroimportoren and Europris ASA
Assuming the 90 days trading horizon Elektroimportoren As is expected to generate 2.39 times more return on investment than Europris ASA. However, Elektroimportoren is 2.39 times more volatile than Europris ASA. It trades about 0.18 of its potential returns per unit of risk. Europris ASA is currently generating about 0.36 per unit of risk. If you would invest 1,170 in Elektroimportoren As on September 13, 2024 and sell it today you would earn a total of 155.00 from holding Elektroimportoren As or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elektroimportoren As vs. Europris ASA
Performance |
| Timeline |
| Elektroimportoren |
| Europris ASA |
Elektroimportoren and Europris ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elektroimportoren and Europris ASA
The main advantage of trading using opposite Elektroimportoren and Europris ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elektroimportoren position performs unexpectedly, Europris ASA 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 Europris ASA will offset losses from the drop in Europris ASA's long position.| Elektroimportoren vs. Europris ASA | Elektroimportoren vs. Kid ASA | Elektroimportoren vs. XXL ASA | Elektroimportoren vs. Kitron ASA |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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