Correlation Between AP Mller and Brd Klee
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By analyzing existing cross correlation between AP Mller and Brd Klee AS, you can compare the effects of market volatilities on AP Mller and Brd Klee 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 AP Mller with a short position of Brd Klee. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Mller and Brd Klee.
Diversification Opportunities for AP Mller and Brd Klee
Excellent diversification
The 3 months correlation between MAERSK-A and Brd is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding AP Mller and Brd Klee AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brd Klee AS and AP Mller 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 AP Mller are associated (or correlated) with Brd Klee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brd Klee AS has no effect on the direction of AP Mller i.e., AP Mller and Brd Klee go up and down completely randomly.
Pair Corralation between AP Mller and Brd Klee
Assuming the 90 days trading horizon AP Mller is expected to generate 2.07 times more return on investment than Brd Klee. However, AP Mller is 2.07 times more volatile than Brd Klee AS. It trades about 0.15 of its potential returns per unit of risk. Brd Klee AS is currently generating about 0.04 per unit of risk. If you would invest 1,004,000 in AP Mller on August 29, 2024 and sell it today you would earn a total of 108,000 from holding AP Mller or generate 10.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
AP Mller vs. Brd Klee AS
Performance |
| Timeline |
| AP Mller |
| Brd Klee AS |
AP Mller and Brd Klee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Mller and Brd Klee
The main advantage of trading using opposite AP Mller and Brd Klee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Mller position performs unexpectedly, Brd Klee 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 Brd Klee will offset losses from the drop in Brd Klee's long position.The idea behind AP Mller and Brd Klee AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Brd Klee vs. RIAS AS | Brd Klee vs. Investeringsselskabet Luxor AS | Brd Klee vs. Glunz Jensen | Brd Klee vs. SKAKO AS |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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