Correlation Between Enea AB and Exsitec Holding
Can any of the company-specific risk be diversified away by investing in both Enea AB and Exsitec Holding 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 Enea AB and Exsitec Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enea AB and Exsitec Holding AB, you can compare the effects of market volatilities on Enea AB and Exsitec Holding 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 Enea AB with a short position of Exsitec Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enea AB and Exsitec Holding.
Diversification Opportunities for Enea AB and Exsitec Holding
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enea and Exsitec is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Enea AB and Exsitec Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exsitec Holding AB and Enea 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 Enea AB are associated (or correlated) with Exsitec Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exsitec Holding AB has no effect on the direction of Enea AB i.e., Enea AB and Exsitec Holding go up and down completely randomly.
Pair Corralation between Enea AB and Exsitec Holding
Assuming the 90 days trading horizon Enea AB is expected to generate 1.1 times more return on investment than Exsitec Holding. However, Enea AB is 1.1 times more volatile than Exsitec Holding AB. It trades about 0.1 of its potential returns per unit of risk. Exsitec Holding AB is currently generating about -0.09 per unit of risk. If you would invest 7,510 in Enea AB on October 13, 2024 and sell it today you would earn a total of 2,610 from holding Enea AB or generate 34.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enea AB vs. Exsitec Holding AB
Performance |
| Timeline |
| Enea AB |
| Exsitec Holding AB |
Enea AB and Exsitec Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enea AB and Exsitec Holding
The main advantage of trading using opposite Enea AB and Exsitec Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enea AB position performs unexpectedly, Exsitec Holding 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 Exsitec Holding will offset losses from the drop in Exsitec Holding's long position.| Enea AB vs. Know IT AB | Enea AB vs. Inwido AB | Enea AB vs. VBG Group AB | Enea AB vs. G5 Entertainment publ |
| Exsitec Holding vs. CAG Group AB | Exsitec Holding vs. Know IT AB | Exsitec Holding vs. Enea AB | Exsitec Holding vs. NCAB Group |
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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