Correlation Between Momentum Group and Enad Global
Can any of the company-specific risk be diversified away by investing in both Momentum Group and Enad Global 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 Momentum Group and Enad Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Momentum Group AB and Enad Global 7, you can compare the effects of market volatilities on Momentum Group and Enad Global 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 Momentum Group with a short position of Enad Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Momentum Group and Enad Global.
Diversification Opportunities for Momentum Group and Enad Global
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Momentum and Enad is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Momentum Group AB and Enad Global 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enad Global 7 and Momentum Group 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 Momentum Group AB are associated (or correlated) with Enad Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enad Global 7 has no effect on the direction of Momentum Group i.e., Momentum Group and Enad Global go up and down completely randomly.
Pair Corralation between Momentum Group and Enad Global
Assuming the 90 days trading horizon Momentum Group AB is expected to generate 0.74 times more return on investment than Enad Global. However, Momentum Group AB is 1.36 times less risky than Enad Global. It trades about 0.02 of its potential returns per unit of risk. Enad Global 7 is currently generating about 0.0 per unit of risk. If you would invest 17,640 in Momentum Group AB on October 13, 2024 and sell it today you would earn a total of 520.00 from holding Momentum Group AB or generate 2.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Momentum Group AB vs. Enad Global 7
Performance |
| Timeline |
| Momentum Group AB |
| Enad Global 7 |
Momentum Group and Enad Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Momentum Group and Enad Global
The main advantage of trading using opposite Momentum Group and Enad Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Momentum Group position performs unexpectedly, Enad Global 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 Enad Global will offset losses from the drop in Enad Global's long position.| Momentum Group vs. Bergman Beving AB | Momentum Group vs. Lagercrantz Group AB | Momentum Group vs. AddLife AB | Momentum Group vs. Addtech AB |
| Enad Global vs. Stillfront Group AB | Enad Global vs. Embracer Group AB | Enad Global vs. G5 Entertainment publ | Enad Global vs. Sinch 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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