Correlation Between Karnov Group and Inwido AB
Can any of the company-specific risk be diversified away by investing in both Karnov Group and Inwido 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 Karnov Group and Inwido AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karnov Group AB and Inwido AB, you can compare the effects of market volatilities on Karnov Group and Inwido 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 Karnov Group with a short position of Inwido AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karnov Group and Inwido AB.
Diversification Opportunities for Karnov Group and Inwido AB
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Karnov and Inwido is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Karnov Group AB and Inwido AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inwido AB and Karnov 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 Karnov Group AB are associated (or correlated) with Inwido AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inwido AB has no effect on the direction of Karnov Group i.e., Karnov Group and Inwido AB go up and down completely randomly.
Pair Corralation between Karnov Group and Inwido AB
Assuming the 90 days trading horizon Karnov Group AB is expected to generate 1.28 times more return on investment than Inwido AB. However, Karnov Group is 1.28 times more volatile than Inwido AB. It trades about 0.04 of its potential returns per unit of risk. Inwido AB is currently generating about -0.21 per unit of risk. If you would invest 7,980 in Karnov Group AB on August 29, 2024 and sell it today you would earn a total of 80.00 from holding Karnov Group AB or generate 1.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Karnov Group AB vs. Inwido AB
Performance |
| Timeline |
| Karnov Group AB |
| Inwido AB |
Karnov Group and Inwido AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Karnov Group and Inwido AB
The main advantage of trading using opposite Karnov Group and Inwido AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karnov Group position performs unexpectedly, Inwido 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 Inwido AB will offset losses from the drop in Inwido AB's long position.| Karnov Group vs. Attendo AB | Karnov Group vs. Ambea AB | Karnov Group vs. Inwido AB | Karnov Group vs. AcadeMedia AB |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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