Correlation Between Mekonomen and Svenska Handelsbanken
Can any of the company-specific risk be diversified away by investing in both Mekonomen and Svenska Handelsbanken 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 Mekonomen and Svenska Handelsbanken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mekonomen AB and Svenska Handelsbanken AB, you can compare the effects of market volatilities on Mekonomen and Svenska Handelsbanken 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 Svenska Handelsbanken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mekonomen and Svenska Handelsbanken.
Diversification Opportunities for Mekonomen and Svenska Handelsbanken
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mekonomen and Svenska is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mekonomen AB and Svenska Handelsbanken AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Svenska Handelsbanken 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 Svenska Handelsbanken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Svenska Handelsbanken has no effect on the direction of Mekonomen i.e., Mekonomen and Svenska Handelsbanken go up and down completely randomly.
Pair Corralation between Mekonomen and Svenska Handelsbanken
If you would invest 11,380 in Svenska Handelsbanken AB on November 2, 2024 and sell it today you would earn a total of 990.00 from holding Svenska Handelsbanken AB or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Mekonomen AB vs. Svenska Handelsbanken AB
Performance |
| Timeline |
| Mekonomen AB |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Svenska Handelsbanken |
Mekonomen and Svenska Handelsbanken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mekonomen and Svenska Handelsbanken
The main advantage of trading using opposite Mekonomen and Svenska Handelsbanken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mekonomen position performs unexpectedly, Svenska Handelsbanken 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 Svenska Handelsbanken will offset losses from the drop in Svenska Handelsbanken's long position.The idea behind Mekonomen AB and Svenska Handelsbanken 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.| Svenska Handelsbanken vs. Swedbank AB | Svenska Handelsbanken vs. Nordea Bank Abp | Svenska Handelsbanken vs. Tele2 AB | Svenska Handelsbanken vs. Telia Company 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 Stocks Directory module to find actively traded stocks across global markets.
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