Correlation Between Hanza AB and BIMobject
Can any of the company-specific risk be diversified away by investing in both Hanza AB and BIMobject 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 Hanza AB and BIMobject into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanza AB and BIMobject AB, you can compare the effects of market volatilities on Hanza AB and BIMobject 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 Hanza AB with a short position of BIMobject. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanza AB and BIMobject.
Diversification Opportunities for Hanza AB and BIMobject
Weak diversification
The 3 months correlation between Hanza and BIMobject is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Hanza AB and BIMobject AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BIMobject AB and Hanza 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 Hanza AB are associated (or correlated) with BIMobject. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BIMobject AB has no effect on the direction of Hanza AB i.e., Hanza AB and BIMobject go up and down completely randomly.
Pair Corralation between Hanza AB and BIMobject
Assuming the 90 days trading horizon Hanza AB is expected to generate 2.25 times more return on investment than BIMobject. However, Hanza AB is 2.25 times more volatile than BIMobject AB. It trades about 0.16 of its potential returns per unit of risk. BIMobject AB is currently generating about -0.06 per unit of risk. If you would invest 5,950 in Hanza AB on August 29, 2024 and sell it today you would earn a total of 800.00 from holding Hanza AB or generate 13.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanza AB vs. BIMobject AB
Performance |
| Timeline |
| Hanza AB |
| BIMobject AB |
Hanza AB and BIMobject Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanza AB and BIMobject
The main advantage of trading using opposite Hanza AB and BIMobject positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanza AB position performs unexpectedly, BIMobject 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 BIMobject will offset losses from the drop in BIMobject's long position.| Hanza AB vs. Divio Technologies AB | Hanza AB vs. XMReality AB | Hanza AB vs. KABE Group AB | Hanza AB vs. IAR Systems Group |
| BIMobject vs. G5 Entertainment publ | BIMobject vs. Bambuser AB | BIMobject vs. Catena Media plc | BIMobject vs. Crunchfish 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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