Correlation Between Telefonaktiebolaget and Essity AB
Specify exactly 2 symbols:
By analyzing existing cross correlation between Telefonaktiebolaget LM Ericsson and Essity AB, you can compare the effects of market volatilities on Telefonaktiebolaget and Essity 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 Telefonaktiebolaget with a short position of Essity AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telefonaktiebolaget and Essity AB.
Diversification Opportunities for Telefonaktiebolaget and Essity AB
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Telefonaktiebolaget and Essity is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Telefonaktiebolaget LM Ericsso and Essity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Essity AB and Telefonaktiebolaget 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 Telefonaktiebolaget LM Ericsson are associated (or correlated) with Essity AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Essity AB has no effect on the direction of Telefonaktiebolaget i.e., Telefonaktiebolaget and Essity AB go up and down completely randomly.
Pair Corralation between Telefonaktiebolaget and Essity AB
Assuming the 90 days trading horizon Telefonaktiebolaget LM Ericsson is expected to generate 1.63 times more return on investment than Essity AB. However, Telefonaktiebolaget is 1.63 times more volatile than Essity AB. It trades about 0.05 of its potential returns per unit of risk. Essity AB is currently generating about 0.02 per unit of risk. If you would invest 5,981 in Telefonaktiebolaget LM Ericsson on November 2, 2024 and sell it today you would earn a total of 2,539 from holding Telefonaktiebolaget LM Ericsson or generate 42.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telefonaktiebolaget LM Ericsso vs. Essity AB
Performance |
| Timeline |
| Telefonaktiebolaget |
| Essity AB |
Telefonaktiebolaget and Essity AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telefonaktiebolaget and Essity AB
The main advantage of trading using opposite Telefonaktiebolaget and Essity AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telefonaktiebolaget position performs unexpectedly, Essity 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 Essity AB will offset losses from the drop in Essity AB's long position.| Telefonaktiebolaget vs. Telefonaktiebolaget LM Ericsson | Telefonaktiebolaget vs. AB Volvo | Telefonaktiebolaget vs. Investor AB ser | Telefonaktiebolaget vs. Industrivarden AB ser |
| Essity AB vs. Svenska Cellulosa Aktiebolaget | Essity AB vs. ASSA ABLOY AB | Essity AB vs. AB Electrolux | Essity AB vs. AB SKF |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |