Correlation Between Essity AB and BillerudKorsnas
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By analyzing existing cross correlation between Essity AB and BillerudKorsnas AB, you can compare the effects of market volatilities on Essity AB and BillerudKorsnas 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 Essity AB with a short position of BillerudKorsnas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Essity AB and BillerudKorsnas.
Diversification Opportunities for Essity AB and BillerudKorsnas
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Essity and BillerudKorsnas is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Essity AB and BillerudKorsnas AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BillerudKorsnas AB and Essity 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 Essity AB are associated (or correlated) with BillerudKorsnas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BillerudKorsnas AB has no effect on the direction of Essity AB i.e., Essity AB and BillerudKorsnas go up and down completely randomly.
Pair Corralation between Essity AB and BillerudKorsnas
Assuming the 90 days trading horizon Essity AB is expected to generate 1.87 times less return on investment than BillerudKorsnas. But when comparing it to its historical volatility, Essity AB is 1.27 times less risky than BillerudKorsnas. It trades about 0.22 of its potential returns per unit of risk. BillerudKorsnas AB is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 11,270 in BillerudKorsnas AB on November 27, 2024 and sell it today you would earn a total of 900.00 from holding BillerudKorsnas AB or generate 7.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Essity AB vs. BillerudKorsnas AB
Performance |
| Timeline |
| Essity AB |
| BillerudKorsnas AB |
Essity AB and BillerudKorsnas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Essity AB and BillerudKorsnas
The main advantage of trading using opposite Essity AB and BillerudKorsnas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Essity AB position performs unexpectedly, BillerudKorsnas 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 BillerudKorsnas will offset losses from the drop in BillerudKorsnas' long position.| Essity AB vs. Svenska Cellulosa Aktiebolaget | Essity AB vs. ASSA ABLOY AB | Essity AB vs. AB Electrolux | Essity AB vs. AB SKF |
| BillerudKorsnas vs. Holmen AB | BillerudKorsnas vs. Svenska Cellulosa Aktiebolaget | BillerudKorsnas vs. Husqvarna AB | BillerudKorsnas vs. Alfa Laval 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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