Correlation Between Ferronordic and Inwido AB
Can any of the company-specific risk be diversified away by investing in both Ferronordic and Inwido 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 Ferronordic and Inwido AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ferronordic AB and Inwido AB, you can compare the effects of market volatilities on Ferronordic and Inwido 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 Ferronordic with a short position of Inwido AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferronordic and Inwido AB.
Diversification Opportunities for Ferronordic and Inwido AB
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ferronordic and Inwido is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Ferronordic AB and Inwido AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inwido AB and Ferronordic 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 Ferronordic AB are associated (or correlated) with Inwido AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inwido AB has no effect on the direction of Ferronordic i.e., Ferronordic and Inwido AB go up and down completely randomly.
Pair Corralation between Ferronordic and Inwido AB
Assuming the 90 days trading horizon Ferronordic is expected to generate 1.92 times less return on investment than Inwido AB. In addition to that, Ferronordic is 1.65 times more volatile than Inwido AB. It trades about 0.02 of its total potential returns per unit of risk. Inwido AB is currently generating about 0.07 per unit of volatility. If you would invest 9,877 in Inwido AB on September 3, 2024 and sell it today you would earn a total of 8,523 from holding Inwido AB or generate 86.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ferronordic AB vs. Inwido AB
Performance |
| Timeline |
| Ferronordic AB |
| Inwido AB |
Ferronordic and Inwido AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ferronordic and Inwido AB
The main advantage of trading using opposite Ferronordic and Inwido AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ferronordic position performs unexpectedly, Inwido 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 Inwido AB will offset losses from the drop in Inwido AB's long position.| Ferronordic vs. TradeDoubler AB | Ferronordic vs. 24SevenOffice Scandinavia AB | Ferronordic vs. Kinnevik Investment AB | Ferronordic vs. Lundin Mining |
| Inwido AB vs. Lohilo Foods AB | Inwido AB vs. FormPipe Software AB | Inwido AB vs. NetJobs Group AB | Inwido AB vs. Kinnevik Investment 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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