Correlation Between NIBE Industrier and Mantex AB
Can any of the company-specific risk be diversified away by investing in both NIBE Industrier and Mantex AB 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 NIBE Industrier and Mantex AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NIBE Industrier AB and Mantex AB, you can compare the effects of market volatilities on NIBE Industrier and Mantex AB 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 NIBE Industrier with a short position of Mantex AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIBE Industrier and Mantex AB.
Diversification Opportunities for NIBE Industrier and Mantex AB
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NIBE and Mantex is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding NIBE Industrier AB and Mantex AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mantex AB and NIBE Industrier 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 NIBE Industrier AB are associated (or correlated) with Mantex AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mantex AB has no effect on the direction of NIBE Industrier i.e., NIBE Industrier and Mantex AB go up and down completely randomly.
Pair Corralation between NIBE Industrier and Mantex AB
Assuming the 90 days trading horizon NIBE Industrier AB is expected to generate 0.55 times more return on investment than Mantex AB. However, NIBE Industrier AB is 1.83 times less risky than Mantex AB. It trades about -0.04 of its potential returns per unit of risk. Mantex AB is currently generating about -0.13 per unit of risk. If you would invest 6,837 in NIBE Industrier AB on September 3, 2024 and sell it today you would lose (2,215) from holding NIBE Industrier AB or give up 32.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NIBE Industrier AB vs. Mantex AB
Performance |
| Timeline |
| NIBE Industrier AB |
| Mantex AB |
NIBE Industrier and Mantex AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NIBE Industrier and Mantex AB
The main advantage of trading using opposite NIBE Industrier and Mantex AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIBE Industrier position performs unexpectedly, Mantex AB 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 Mantex AB will offset losses from the drop in Mantex AB's long position.| NIBE Industrier vs. Hexagon AB | NIBE Industrier vs. Investor AB ser | NIBE Industrier vs. Investment AB Latour | NIBE Industrier vs. ASSA ABLOY 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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