Correlation Between Embracer Group and Lipum AB
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By analyzing existing cross correlation between Embracer Group AB and Lipum AB, you can compare the effects of market volatilities on Embracer Group and Lipum 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 Embracer Group with a short position of Lipum AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embracer Group and Lipum AB.
Diversification Opportunities for Embracer Group and Lipum AB
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Embracer and Lipum is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Embracer Group AB and Lipum AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipum AB and Embracer Group 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 Embracer Group AB are associated (or correlated) with Lipum AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lipum AB has no effect on the direction of Embracer Group i.e., Embracer Group and Lipum AB go up and down completely randomly.
Pair Corralation between Embracer Group and Lipum AB
Assuming the 90 days trading horizon Embracer Group AB is expected to generate 1.37 times more return on investment than Lipum AB. However, Embracer Group is 1.37 times more volatile than Lipum AB. It trades about 0.18 of its potential returns per unit of risk. Lipum AB is currently generating about 0.14 per unit of risk. If you would invest 20,022 in Embracer Group AB on November 2, 2024 and sell it today you would earn a total of 2,478 from holding Embracer Group AB or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embracer Group AB vs. Lipum AB
Performance |
| Timeline |
| Embracer Group AB |
| Lipum AB |
Embracer Group and Lipum AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embracer Group and Lipum AB
The main advantage of trading using opposite Embracer Group and Lipum AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embracer Group position performs unexpectedly, Lipum 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 Lipum AB will offset losses from the drop in Lipum AB's long position.| Embracer Group vs. Evolution AB | Embracer Group vs. Sinch AB | Embracer Group vs. Samhllsbyggnadsbolaget i Norden | Embracer Group vs. Stillfront Group AB |
| Lipum AB vs. Ascelia Pharma AB | Lipum AB vs. NextCell Pharma AB | Lipum AB vs. Annexin Pharmaceuticals AB | Lipum AB vs. AlzeCure Pharma |
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 CEOs Directory module to screen CEOs from public companies around the world.
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