Correlation Between Lowland Investment and Magnora ASA
Can any of the company-specific risk be diversified away by investing in both Lowland Investment and Magnora ASA 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 Lowland Investment and Magnora ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lowland Investment Co and Magnora ASA, you can compare the effects of market volatilities on Lowland Investment and Magnora ASA 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 Lowland Investment with a short position of Magnora ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lowland Investment and Magnora ASA.
Diversification Opportunities for Lowland Investment and Magnora ASA
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lowland and Magnora is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Lowland Investment Co and Magnora ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magnora ASA and Lowland Investment 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 Lowland Investment Co are associated (or correlated) with Magnora ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magnora ASA has no effect on the direction of Lowland Investment i.e., Lowland Investment and Magnora ASA go up and down completely randomly.
Pair Corralation between Lowland Investment and Magnora ASA
Assuming the 90 days trading horizon Lowland Investment Co is expected to generate 0.39 times more return on investment than Magnora ASA. However, Lowland Investment Co is 2.59 times less risky than Magnora ASA. It trades about 0.07 of its potential returns per unit of risk. Magnora ASA is currently generating about -0.02 per unit of risk. If you would invest 11,500 in Lowland Investment Co on December 4, 2024 and sell it today you would earn a total of 1,850 from holding Lowland Investment Co or generate 16.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.08% |
| Values | Daily Returns |
Lowland Investment Co vs. Magnora ASA
Performance |
| Timeline |
| Lowland Investment |
| Magnora ASA |
Lowland Investment and Magnora ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lowland Investment and Magnora ASA
The main advantage of trading using opposite Lowland Investment and Magnora ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lowland Investment position performs unexpectedly, Magnora ASA 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 Magnora ASA will offset losses from the drop in Magnora ASA's long position.| Lowland Investment vs. Infrastrutture Wireless Italiane | Lowland Investment vs. Air Products Chemicals | Lowland Investment vs. Scottish American Investment | Lowland Investment vs. Kinnevik Investment AB |
| Magnora ASA vs. Lendinvest PLC | Magnora ASA vs. Nordea Bank Abp | Magnora ASA vs. Teradata Corp | Magnora ASA vs. Liechtensteinische Landesbank AG |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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