Correlation Between MIPS AB and Lime Technologies
Can any of the company-specific risk be diversified away by investing in both MIPS AB and Lime Technologies 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 MIPS AB and Lime Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MIPS AB and Lime Technologies AB, you can compare the effects of market volatilities on MIPS AB and Lime 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 MIPS AB with a short position of Lime Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of MIPS AB and Lime Technologies.
Diversification Opportunities for MIPS AB and Lime Technologies
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MIPS and Lime is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding MIPS AB and Lime Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lime Technologies and MIPS 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 MIPS AB are associated (or correlated) with Lime Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lime Technologies has no effect on the direction of MIPS AB i.e., MIPS AB and Lime Technologies go up and down completely randomly.
Pair Corralation between MIPS AB and Lime Technologies
Assuming the 90 days trading horizon MIPS AB is expected to generate 0.84 times more return on investment than Lime Technologies. However, MIPS AB is 1.19 times less risky than Lime Technologies. It trades about 0.11 of its potential returns per unit of risk. Lime Technologies AB is currently generating about 0.07 per unit of risk. If you would invest 46,680 in MIPS AB on October 26, 2024 and sell it today you would earn a total of 3,920 from holding MIPS AB or generate 8.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MIPS AB vs. Lime Technologies AB
Performance |
| Timeline |
| MIPS AB |
| Lime Technologies |
MIPS AB and Lime Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MIPS AB and Lime Technologies
The main advantage of trading using opposite MIPS AB and Lime Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MIPS AB position performs unexpectedly, Lime 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 Lime Technologies will offset losses from the drop in Lime Technologies' long position.| MIPS AB vs. Thule Group AB | MIPS AB vs. Sinch AB | MIPS AB vs. Hexatronic Group AB | MIPS AB vs. NIBE Industrier AB |
| Lime Technologies vs. Vitec Software Group | Lime Technologies vs. MIPS AB | Lime Technologies vs. Sinch AB | Lime Technologies vs. Stillfront Group 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |