Correlation Between Lime Technologies and Terranet
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By analyzing existing cross correlation between Lime Technologies AB and Terranet AB, you can compare the effects of market volatilities on Lime Technologies and Terranet 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 Lime Technologies with a short position of Terranet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lime Technologies and Terranet.
Diversification Opportunities for Lime Technologies and Terranet
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lime and Terranet is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lime Technologies AB and Terranet AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Terranet AB and Lime Technologies 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 Lime Technologies AB are associated (or correlated) with Terranet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Terranet AB has no effect on the direction of Lime Technologies i.e., Lime Technologies and Terranet go up and down completely randomly.
Pair Corralation between Lime Technologies and Terranet
Assuming the 90 days trading horizon Lime Technologies AB is expected to under-perform the Terranet. But the stock apears to be less risky and, when comparing its historical volatility, Lime Technologies AB is 3.62 times less risky than Terranet. The stock trades about -0.01 of its potential returns per unit of risk. The Terranet AB is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Terranet AB on August 28, 2024 and sell it today you would earn a total of 5.00 from holding Terranet AB or generate 45.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lime Technologies AB vs. Terranet AB
Performance |
| Timeline |
| Lime Technologies |
| Terranet AB |
Lime Technologies and Terranet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lime Technologies and Terranet
The main advantage of trading using opposite Lime Technologies and Terranet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lime Technologies position performs unexpectedly, Terranet 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 Terranet will offset losses from the drop in Terranet's long position.| Lime Technologies vs. Lifco AB | Lime Technologies vs. Lagercrantz Group AB | Lime Technologies vs. Addtech AB | Lime Technologies vs. Instalco Intressenter AB |
| Terranet vs. Lifco AB | Terranet vs. Lagercrantz Group AB | Terranet vs. Addtech AB | Terranet vs. Instalco Intressenter 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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