Correlation Between Midsona AB and Humble Group
Can any of the company-specific risk be diversified away by investing in both Midsona AB and Humble Group 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 Midsona AB and Humble Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Midsona AB and Humble Group AB, you can compare the effects of market volatilities on Midsona AB and Humble Group 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 Midsona AB with a short position of Humble Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Midsona AB and Humble Group.
Diversification Opportunities for Midsona AB and Humble Group
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Midsona and Humble is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Midsona AB and Humble Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humble Group AB and Midsona 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 Midsona AB are associated (or correlated) with Humble Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humble Group AB has no effect on the direction of Midsona AB i.e., Midsona AB and Humble Group go up and down completely randomly.
Pair Corralation between Midsona AB and Humble Group
Assuming the 90 days trading horizon Midsona AB is expected to generate 1.55 times less return on investment than Humble Group. In addition to that, Midsona AB is 1.21 times more volatile than Humble Group AB. It trades about 0.02 of its total potential returns per unit of risk. Humble Group AB is currently generating about 0.03 per unit of volatility. If you would invest 935.00 in Humble Group AB on September 14, 2024 and sell it today you would earn a total of 308.00 from holding Humble Group AB or generate 32.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Midsona AB vs. Humble Group AB
Performance |
| Timeline |
| Midsona AB |
| Humble Group AB |
Midsona AB and Humble Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Midsona AB and Humble Group
The main advantage of trading using opposite Midsona AB and Humble Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Midsona AB position performs unexpectedly, Humble Group 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 Humble Group will offset losses from the drop in Humble Group's long position.| Midsona AB vs. Midsona AB | Midsona AB vs. Know IT AB | Midsona AB vs. Probi AB | Midsona AB vs. BTS Group AB |
| Humble Group vs. Samhllsbyggnadsbolaget i Norden | Humble Group vs. Media and Games | Humble Group vs. Hexatronic Group AB | Humble Group 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |