Correlation Between Impact Coatings and Minesto AB
Can any of the company-specific risk be diversified away by investing in both Impact Coatings and Minesto 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 Impact Coatings and Minesto AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impact Coatings publ and Minesto AB, you can compare the effects of market volatilities on Impact Coatings and Minesto 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 Impact Coatings with a short position of Minesto AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impact Coatings and Minesto AB.
Diversification Opportunities for Impact Coatings and Minesto AB
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Impact and Minesto is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Impact Coatings publ and Minesto AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minesto AB and Impact Coatings 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 Impact Coatings publ are associated (or correlated) with Minesto AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minesto AB has no effect on the direction of Impact Coatings i.e., Impact Coatings and Minesto AB go up and down completely randomly.
Pair Corralation between Impact Coatings and Minesto AB
Assuming the 90 days trading horizon Impact Coatings publ is expected to generate 1.22 times more return on investment than Minesto AB. However, Impact Coatings is 1.22 times more volatile than Minesto AB. It trades about 0.09 of its potential returns per unit of risk. Minesto AB is currently generating about -0.31 per unit of risk. If you would invest 409.00 in Impact Coatings publ on August 25, 2024 and sell it today you would earn a total of 29.00 from holding Impact Coatings publ or generate 7.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impact Coatings publ vs. Minesto AB
Performance |
| Timeline |
| Impact Coatings publ |
| Minesto AB |
Impact Coatings and Minesto AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impact Coatings and Minesto AB
The main advantage of trading using opposite Impact Coatings and Minesto AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impact Coatings position performs unexpectedly, Minesto 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 Minesto AB will offset losses from the drop in Minesto AB's long position.| Impact Coatings vs. Addtech AB | Impact Coatings vs. Teqnion AB | Impact Coatings vs. Vitec Software Group | Impact Coatings vs. Lagercrantz Group AB |
| Minesto AB vs. SolTech Energy Sweden | Minesto AB vs. Eolus Vind AB | Minesto AB vs. Climeon AB | Minesto AB vs. Powercell Sweden |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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