Correlation Between Garo AB and Bergman Beving
Can any of the company-specific risk be diversified away by investing in both Garo AB and Bergman Beving 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 Garo AB and Bergman Beving into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Garo AB and Bergman Beving AB, you can compare the effects of market volatilities on Garo AB and Bergman Beving 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 Garo AB with a short position of Bergman Beving. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garo AB and Bergman Beving.
Diversification Opportunities for Garo AB and Bergman Beving
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Garo and Bergman is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Garo AB and Bergman Beving AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bergman Beving AB and Garo 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 Garo AB are associated (or correlated) with Bergman Beving. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bergman Beving AB has no effect on the direction of Garo AB i.e., Garo AB and Bergman Beving go up and down completely randomly.
Pair Corralation between Garo AB and Bergman Beving
Assuming the 90 days trading horizon Garo AB is expected to generate 1.54 times more return on investment than Bergman Beving. However, Garo AB is 1.54 times more volatile than Bergman Beving AB. It trades about -0.11 of its potential returns per unit of risk. Bergman Beving AB is currently generating about -0.35 per unit of risk. If you would invest 2,110 in Garo AB on August 26, 2024 and sell it today you would lose (132.00) from holding Garo AB or give up 6.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Garo AB vs. Bergman Beving AB
Performance |
| Timeline |
| Garo AB |
| Bergman Beving AB |
Garo AB and Bergman Beving Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Garo AB and Bergman Beving
The main advantage of trading using opposite Garo AB and Bergman Beving positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garo AB position performs unexpectedly, Bergman Beving 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 Bergman Beving will offset losses from the drop in Bergman Beving's long position.| Garo AB vs. Troax Group AB | Garo AB vs. NIBE Industrier AB | Garo AB vs. Hexatronic Group AB | Garo AB vs. Bufab Holding AB |
| Bergman Beving vs. Lagercrantz Group AB | Bergman Beving vs. Addtech AB | Bergman Beving vs. AddLife AB | Bergman Beving vs. Bufab Holding 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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