Correlation Between Hexatronic Group and BE Group
Can any of the company-specific risk be diversified away by investing in both Hexatronic Group and BE Group 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 Hexatronic Group and BE Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hexatronic Group AB and BE Group AB, you can compare the effects of market volatilities on Hexatronic Group and BE Group 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 Hexatronic Group with a short position of BE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexatronic Group and BE Group.
Diversification Opportunities for Hexatronic Group and BE Group
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hexatronic and BEGR is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hexatronic Group AB and BE Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BE Group AB and Hexatronic Group 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 Hexatronic Group AB are associated (or correlated) with BE Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BE Group AB has no effect on the direction of Hexatronic Group i.e., Hexatronic Group and BE Group go up and down completely randomly.
Pair Corralation between Hexatronic Group and BE Group
Assuming the 90 days trading horizon Hexatronic Group AB is expected to under-perform the BE Group. In addition to that, Hexatronic Group is 1.77 times more volatile than BE Group AB. It trades about -0.3 of its total potential returns per unit of risk. BE Group AB is currently generating about -0.37 per unit of volatility. If you would invest 5,100 in BE Group AB on September 2, 2024 and sell it today you would lose (500.00) from holding BE Group AB or give up 9.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexatronic Group AB vs. BE Group AB
Performance |
| Timeline |
| Hexatronic Group |
| BE Group AB |
Hexatronic Group and BE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexatronic Group and BE Group
The main advantage of trading using opposite Hexatronic Group and BE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexatronic Group position performs unexpectedly, BE Group 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 BE Group will offset losses from the drop in BE Group's long position.| Hexatronic Group vs. Samhllsbyggnadsbolaget i Norden | Hexatronic Group vs. Sinch AB | Hexatronic Group vs. Embracer Group AB | Hexatronic Group vs. Evolution AB |
| BE Group vs. Bjorn Borg AB | BE Group vs. BioInvent International AB | BE Group vs. Lindab International AB | BE Group vs. Clas Ohlson 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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