Correlation Between FastPartner and EEducation Albert
Can any of the company-specific risk be diversified away by investing in both FastPartner and EEducation Albert 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 FastPartner and EEducation Albert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FastPartner AB and eEducation Albert AB, you can compare the effects of market volatilities on FastPartner and EEducation Albert 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 FastPartner with a short position of EEducation Albert. Check out your portfolio center. Please also check ongoing floating volatility patterns of FastPartner and EEducation Albert.
Diversification Opportunities for FastPartner and EEducation Albert
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FastPartner and EEducation is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding FastPartner AB and eEducation Albert AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eEducation Albert and FastPartner 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 FastPartner AB are associated (or correlated) with EEducation Albert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eEducation Albert has no effect on the direction of FastPartner i.e., FastPartner and EEducation Albert go up and down completely randomly.
Pair Corralation between FastPartner and EEducation Albert
Assuming the 90 days trading horizon FastPartner AB is expected to under-perform the EEducation Albert. But the stock apears to be less risky and, when comparing its historical volatility, FastPartner AB is 1.09 times less risky than EEducation Albert. The stock trades about -0.29 of its potential returns per unit of risk. The eEducation Albert AB is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 380.00 in eEducation Albert AB on August 29, 2024 and sell it today you would lose (15.00) from holding eEducation Albert AB or give up 3.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FastPartner AB vs. eEducation Albert AB
Performance |
| Timeline |
| FastPartner AB |
| eEducation Albert |
FastPartner and EEducation Albert Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FastPartner and EEducation Albert
The main advantage of trading using opposite FastPartner and EEducation Albert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FastPartner position performs unexpectedly, EEducation Albert 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 EEducation Albert will offset losses from the drop in EEducation Albert's long position.| FastPartner vs. Hufvudstaden AB | FastPartner vs. ALM Equity AB | FastPartner vs. KABE Group AB | FastPartner vs. IAR Systems Group |
| EEducation Albert vs. Greater Than AB | EEducation Albert vs. Cint Group AB | EEducation Albert vs. Acconeer AB | EEducation Albert vs. IAR Systems 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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