Correlation Between Malmbergs Elektriska and Divio Technologies
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By analyzing existing cross correlation between Malmbergs Elektriska AB and Divio Technologies AB, you can compare the effects of market volatilities on Malmbergs Elektriska and Divio Technologies 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 Malmbergs Elektriska with a short position of Divio Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malmbergs Elektriska and Divio Technologies.
Diversification Opportunities for Malmbergs Elektriska and Divio Technologies
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Malmbergs and Divio is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Malmbergs Elektriska AB and Divio Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Divio Technologies and Malmbergs Elektriska 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 Malmbergs Elektriska AB are associated (or correlated) with Divio Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Divio Technologies has no effect on the direction of Malmbergs Elektriska i.e., Malmbergs Elektriska and Divio Technologies go up and down completely randomly.
Pair Corralation between Malmbergs Elektriska and Divio Technologies
Assuming the 90 days trading horizon Malmbergs Elektriska AB is expected to under-perform the Divio Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Malmbergs Elektriska AB is 5.31 times less risky than Divio Technologies. The stock trades about -0.01 of its potential returns per unit of risk. The Divio Technologies AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 16.00 in Divio Technologies AB on August 28, 2024 and sell it today you would lose (1.00) from holding Divio Technologies AB or give up 6.25% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Malmbergs Elektriska AB vs. Divio Technologies AB
Performance |
Timeline |
Malmbergs Elektriska |
Divio Technologies |
Malmbergs Elektriska and Divio Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Malmbergs Elektriska and Divio Technologies
The main advantage of trading using opposite Malmbergs Elektriska and Divio Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malmbergs Elektriska position performs unexpectedly, Divio Technologies 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 Divio Technologies will offset losses from the drop in Divio Technologies' long position.Malmbergs Elektriska vs. Divio Technologies AB | Malmbergs Elektriska vs. XMReality AB | Malmbergs Elektriska vs. KABE Group AB | Malmbergs Elektriska vs. IAR Systems Group |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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