Correlation Between Lagercrantz Group and BE Group
Can any of the company-specific risk be diversified away by investing in both Lagercrantz 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 Lagercrantz 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 Lagercrantz Group AB and BE Group AB, you can compare the effects of market volatilities on Lagercrantz 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 Lagercrantz Group with a short position of BE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lagercrantz Group and BE Group.
Diversification Opportunities for Lagercrantz Group and BE Group
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lagercrantz and BEGR is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Lagercrantz 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 Lagercrantz 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 Lagercrantz 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 Lagercrantz Group i.e., Lagercrantz Group and BE Group go up and down completely randomly.
Pair Corralation between Lagercrantz Group and BE Group
Assuming the 90 days trading horizon Lagercrantz Group AB is expected to generate 0.81 times more return on investment than BE Group. However, Lagercrantz Group AB is 1.24 times less risky than BE Group. It trades about 0.11 of its potential returns per unit of risk. BE Group AB is currently generating about -0.08 per unit of risk. If you would invest 11,102 in Lagercrantz Group AB on August 25, 2024 and sell it today you would earn a total of 8,278 from holding Lagercrantz Group AB or generate 74.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lagercrantz Group AB vs. BE Group AB
Performance |
| Timeline |
| Lagercrantz Group |
| BE Group AB |
Lagercrantz Group and BE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lagercrantz Group and BE Group
The main advantage of trading using opposite Lagercrantz Group and BE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lagercrantz 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.| Lagercrantz Group vs. Addtech AB | Lagercrantz Group vs. Lifco AB | Lagercrantz Group vs. Indutrade AB | Lagercrantz Group vs. Vitec Software Group |
| BE Group vs. Addtech AB | BE Group vs. Teqnion AB | BE Group vs. Vitec Software Group | BE Group vs. Lagercrantz Group 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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