Correlation Between Lohilo Foods and 24SevenOffice Scandinavia
Can any of the company-specific risk be diversified away by investing in both Lohilo Foods and 24SevenOffice Scandinavia 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 Lohilo Foods and 24SevenOffice Scandinavia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lohilo Foods AB and 24SevenOffice Scandinavia AB, you can compare the effects of market volatilities on Lohilo Foods and 24SevenOffice Scandinavia 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 Lohilo Foods with a short position of 24SevenOffice Scandinavia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohilo Foods and 24SevenOffice Scandinavia.
Diversification Opportunities for Lohilo Foods and 24SevenOffice Scandinavia
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lohilo and 24SevenOffice is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Lohilo Foods AB and 24SevenOffice Scandinavia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 24SevenOffice Scandinavia and Lohilo Foods 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 Lohilo Foods AB are associated (or correlated) with 24SevenOffice Scandinavia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 24SevenOffice Scandinavia has no effect on the direction of Lohilo Foods i.e., Lohilo Foods and 24SevenOffice Scandinavia go up and down completely randomly.
Pair Corralation between Lohilo Foods and 24SevenOffice Scandinavia
Assuming the 90 days trading horizon Lohilo Foods is expected to generate 2.33 times less return on investment than 24SevenOffice Scandinavia. In addition to that, Lohilo Foods is 1.28 times more volatile than 24SevenOffice Scandinavia AB. It trades about 0.04 of its total potential returns per unit of risk. 24SevenOffice Scandinavia AB is currently generating about 0.13 per unit of volatility. If you would invest 998.00 in 24SevenOffice Scandinavia AB on August 28, 2024 and sell it today you would earn a total of 1,342 from holding 24SevenOffice Scandinavia AB or generate 134.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lohilo Foods AB vs. 24SevenOffice Scandinavia AB
Performance |
| Timeline |
| Lohilo Foods AB |
| 24SevenOffice Scandinavia |
Lohilo Foods and 24SevenOffice Scandinavia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lohilo Foods and 24SevenOffice Scandinavia
The main advantage of trading using opposite Lohilo Foods and 24SevenOffice Scandinavia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohilo Foods position performs unexpectedly, 24SevenOffice Scandinavia 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 24SevenOffice Scandinavia will offset losses from the drop in 24SevenOffice Scandinavia's long position.| Lohilo Foods vs. Smart Eye AB | Lohilo Foods vs. Kamux Suomi Oy | Lohilo Foods vs. Zignsec AB | Lohilo Foods vs. Harvia Oyj |
| 24SevenOffice Scandinavia vs. Investment AB Oresund | 24SevenOffice Scandinavia vs. Swedbank AB | 24SevenOffice Scandinavia vs. Catena Media plc | 24SevenOffice Scandinavia vs. Soder Sportfiske 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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