Correlation Between Maven Wireless and Profoto Holding
Can any of the company-specific risk be diversified away by investing in both Maven Wireless and Profoto Holding 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 Maven Wireless and Profoto Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maven Wireless Sweden and Profoto Holding AB, you can compare the effects of market volatilities on Maven Wireless and Profoto Holding 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 Maven Wireless with a short position of Profoto Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maven Wireless and Profoto Holding.
Diversification Opportunities for Maven Wireless and Profoto Holding
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Maven and Profoto is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Maven Wireless Sweden and Profoto Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profoto Holding AB and Maven Wireless 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 Maven Wireless Sweden are associated (or correlated) with Profoto Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profoto Holding AB has no effect on the direction of Maven Wireless i.e., Maven Wireless and Profoto Holding go up and down completely randomly.
Pair Corralation between Maven Wireless and Profoto Holding
Assuming the 90 days trading horizon Maven Wireless Sweden is expected to generate 1.3 times more return on investment than Profoto Holding. However, Maven Wireless is 1.3 times more volatile than Profoto Holding AB. It trades about -0.28 of its potential returns per unit of risk. Profoto Holding AB is currently generating about -0.44 per unit of risk. If you would invest 1,100 in Maven Wireless Sweden on September 12, 2024 and sell it today you would lose (192.00) from holding Maven Wireless Sweden or give up 17.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maven Wireless Sweden vs. Profoto Holding AB
Performance |
| Timeline |
| Maven Wireless Sweden |
| Profoto Holding AB |
Maven Wireless and Profoto Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maven Wireless and Profoto Holding
The main advantage of trading using opposite Maven Wireless and Profoto Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maven Wireless position performs unexpectedly, Profoto Holding 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 Profoto Holding will offset losses from the drop in Profoto Holding's long position.| Maven Wireless vs. Checkin Group AB | Maven Wireless vs. Midsummer AB | Maven Wireless vs. Hexatronic Group AB | Maven Wireless vs. Cint Group AB |
| Profoto Holding vs. SolTech Energy Sweden | Profoto Holding vs. 24SevenOffice Scandinavia AB | Profoto Holding vs. Investment AB Oresund | Profoto Holding vs. Vitec Software Group |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |