Correlation Between Mekonomen and Divio Technologies
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By analyzing existing cross correlation between Mekonomen AB and Divio Technologies AB, you can compare the effects of market volatilities on Mekonomen 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 Mekonomen with a short position of Divio Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mekonomen and Divio Technologies.
Diversification Opportunities for Mekonomen and Divio Technologies
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mekonomen and Divio is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Mekonomen 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 Mekonomen 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 Mekonomen 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 Mekonomen i.e., Mekonomen and Divio Technologies go up and down completely randomly.
Pair Corralation between Mekonomen and Divio Technologies
Assuming the 90 days trading horizon Mekonomen AB is expected to generate 0.4 times more return on investment than Divio Technologies. However, Mekonomen AB is 2.52 times less risky than Divio Technologies. It trades about -0.04 of its potential returns per unit of risk. Divio Technologies AB is currently generating about -0.17 per unit of risk. If you would invest 13,592 in Mekonomen AB on September 24, 2024 and sell it today you would lose (452.00) from holding Mekonomen AB or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mekonomen AB vs. Divio Technologies AB
Performance |
| Timeline |
| Mekonomen AB |
| Divio Technologies |
Mekonomen and Divio Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mekonomen and Divio Technologies
The main advantage of trading using opposite Mekonomen and Divio Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mekonomen 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.The idea behind Mekonomen AB and Divio Technologies AB 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.| Divio Technologies vs. FormPipe Software AB | Divio Technologies vs. MOBA Network publ | Divio Technologies vs. Exsitec Holding AB | Divio Technologies vs. Novotek 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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