Correlation Between Inwido AB and H M
Can any of the company-specific risk be diversified away by investing in both Inwido AB and H M 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 Inwido AB and H M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inwido AB and H M Hennes, you can compare the effects of market volatilities on Inwido AB and H M 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 Inwido AB with a short position of H M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inwido AB and H M.
Diversification Opportunities for Inwido AB and H M
Significant diversification
The 3 months correlation between Inwido and HM-B is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Inwido AB and H M Hennes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H M Hennes and Inwido 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 Inwido AB are associated (or correlated) with H M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H M Hennes has no effect on the direction of Inwido AB i.e., Inwido AB and H M go up and down completely randomly.
Pair Corralation between Inwido AB and H M
Assuming the 90 days trading horizon Inwido AB is expected to generate 0.93 times more return on investment than H M. However, Inwido AB is 1.08 times less risky than H M. It trades about 0.07 of its potential returns per unit of risk. H M Hennes is currently generating about 0.04 per unit of risk. If you would invest 9,877 in Inwido AB on September 3, 2024 and sell it today you would earn a total of 8,423 from holding Inwido AB or generate 85.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inwido AB vs. H M Hennes
Performance |
| Timeline |
| Inwido AB |
| H M Hennes |
Inwido AB and H M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inwido AB and H M
The main advantage of trading using opposite Inwido AB and H M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inwido AB position performs unexpectedly, H M 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 H M will offset losses from the drop in H M's long position.| Inwido AB vs. Lohilo Foods AB | Inwido AB vs. FormPipe Software AB | Inwido AB vs. NetJobs Group AB | Inwido AB vs. Kinnevik Investment AB |
| H M vs. Telefonaktiebolaget LM Ericsson | H M vs. Swedbank AB | H M vs. AB Electrolux | H M vs. Investor AB ser |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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