Correlation Between Invisio Communications and Enea AB
Can any of the company-specific risk be diversified away by investing in both Invisio Communications and Enea 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 Invisio Communications and Enea AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invisio Communications AB and Enea AB, you can compare the effects of market volatilities on Invisio Communications and Enea 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 Invisio Communications with a short position of Enea AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invisio Communications and Enea AB.
Diversification Opportunities for Invisio Communications and Enea AB
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Invisio and Enea is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Invisio Communications AB and Enea AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enea AB and Invisio Communications 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 Invisio Communications AB are associated (or correlated) with Enea AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enea AB has no effect on the direction of Invisio Communications i.e., Invisio Communications and Enea AB go up and down completely randomly.
Pair Corralation between Invisio Communications and Enea AB
Assuming the 90 days trading horizon Invisio Communications AB is expected to generate 0.78 times more return on investment than Enea AB. However, Invisio Communications AB is 1.29 times less risky than Enea AB. It trades about 0.05 of its potential returns per unit of risk. Enea AB is currently generating about 0.01 per unit of risk. If you would invest 20,767 in Invisio Communications AB on November 5, 2024 and sell it today you would earn a total of 12,233 from holding Invisio Communications AB or generate 58.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Invisio Communications AB vs. Enea AB
Performance |
| Timeline |
| Invisio Communications |
| Enea AB |
Invisio Communications and Enea AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invisio Communications and Enea AB
The main advantage of trading using opposite Invisio Communications and Enea AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invisio Communications position performs unexpectedly, Enea 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 Enea AB will offset losses from the drop in Enea AB's long position.| Invisio Communications vs. Hexatronic Group AB | Invisio Communications vs. CellaVision AB | Invisio Communications vs. Xvivo Perfusion AB | Invisio Communications vs. Sectra AB |
| Enea AB vs. Know IT AB | Enea AB vs. Proact IT Group | Enea AB vs. Hexatronic Group AB | Enea AB vs. Inwido 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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