Correlation Between Minesto AB and Bambuser
Can any of the company-specific risk be diversified away by investing in both Minesto AB and Bambuser 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 Minesto AB and Bambuser into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Minesto AB and Bambuser AB, you can compare the effects of market volatilities on Minesto AB and Bambuser 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 Minesto AB with a short position of Bambuser. Check out your portfolio center. Please also check ongoing floating volatility patterns of Minesto AB and Bambuser.
Diversification Opportunities for Minesto AB and Bambuser
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Minesto and Bambuser is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Minesto AB and Bambuser AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bambuser AB and Minesto AB 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 Minesto AB are associated (or correlated) with Bambuser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bambuser AB has no effect on the direction of Minesto AB i.e., Minesto AB and Bambuser go up and down completely randomly.
Pair Corralation between Minesto AB and Bambuser
Assuming the 90 days trading horizon Minesto AB is expected to under-perform the Bambuser. But the stock apears to be less risky and, when comparing its historical volatility, Minesto AB is 1.78 times less risky than Bambuser. The stock trades about -0.07 of its potential returns per unit of risk. The Bambuser AB is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 87.00 in Bambuser AB on September 1, 2024 and sell it today you would lose (28.00) from holding Bambuser AB or give up 32.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
Minesto AB vs. Bambuser AB
Performance |
| Timeline |
| Minesto AB |
| Bambuser AB |
Minesto AB and Bambuser Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Minesto AB and Bambuser
The main advantage of trading using opposite Minesto AB and Bambuser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Minesto AB position performs unexpectedly, Bambuser 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 Bambuser will offset losses from the drop in Bambuser's long position.| Minesto AB vs. SolTech Energy Sweden | Minesto AB vs. Eolus Vind AB | Minesto AB vs. Climeon AB | Minesto AB vs. Powercell Sweden |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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