Correlation Between Enersize and Sileon AB
Can any of the company-specific risk be diversified away by investing in both Enersize and Sileon 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 Enersize and Sileon AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enersize Oy and Sileon AB, you can compare the effects of market volatilities on Enersize and Sileon 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 Enersize with a short position of Sileon AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enersize and Sileon AB.
Diversification Opportunities for Enersize and Sileon AB
Poor diversification
The 3 months correlation between Enersize and Sileon is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Enersize Oy and Sileon AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sileon AB and Enersize 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 Enersize Oy are associated (or correlated) with Sileon AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sileon AB has no effect on the direction of Enersize i.e., Enersize and Sileon AB go up and down completely randomly.
Pair Corralation between Enersize and Sileon AB
Assuming the 90 days trading horizon Enersize Oy is expected to generate 0.97 times more return on investment than Sileon AB. However, Enersize Oy is 1.03 times less risky than Sileon AB. It trades about -0.24 of its potential returns per unit of risk. Sileon AB is currently generating about -0.49 per unit of risk. If you would invest 0.68 in Enersize Oy on September 24, 2024 and sell it today you would lose (0.16) from holding Enersize Oy or give up 23.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enersize Oy vs. Sileon AB
Performance |
| Timeline |
| Enersize Oy |
| Sileon AB |
Enersize and Sileon AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enersize and Sileon AB
The main advantage of trading using opposite Enersize and Sileon AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enersize position performs unexpectedly, Sileon 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 Sileon AB will offset losses from the drop in Sileon AB's long position.| Enersize vs. Lifco AB | Enersize vs. Lagercrantz Group AB | Enersize vs. Instalco Intressenter AB | Enersize vs. AddLife AB |
| Sileon AB vs. Enersize Oy | Sileon AB vs. Divio Technologies AB | Sileon AB vs. Mekonomen AB | Sileon AB vs. Embellence Group 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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