Correlation Between Nolato AB and Essity AB
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By analyzing existing cross correlation between Nolato AB and Essity AB, you can compare the effects of market volatilities on Nolato AB and Essity 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 Nolato AB with a short position of Essity AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nolato AB and Essity AB.
Diversification Opportunities for Nolato AB and Essity AB
Good diversification
The 3 months correlation between Nolato and Essity is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Nolato AB and Essity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Essity AB and Nolato 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 Nolato AB are associated (or correlated) with Essity AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Essity AB has no effect on the direction of Nolato AB i.e., Nolato AB and Essity AB go up and down completely randomly.
Pair Corralation between Nolato AB and Essity AB
Assuming the 90 days trading horizon Nolato AB is expected to generate 0.82 times more return on investment than Essity AB. However, Nolato AB is 1.22 times less risky than Essity AB. It trades about 0.16 of its potential returns per unit of risk. Essity AB is currently generating about -0.14 per unit of risk. If you would invest 5,515 in Nolato AB on November 3, 2024 and sell it today you would earn a total of 260.00 from holding Nolato AB or generate 4.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nolato AB vs. Essity AB
Performance |
| Timeline |
| Nolato AB |
| Essity AB |
Nolato AB and Essity AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nolato AB and Essity AB
The main advantage of trading using opposite Nolato AB and Essity AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nolato AB position performs unexpectedly, Essity 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 Essity AB will offset losses from the drop in Essity AB's long position.| Nolato AB vs. HEXPOL AB | Nolato AB vs. Trelleborg AB | Nolato AB vs. Indutrade AB | Nolato AB vs. Vitrolife AB |
| Essity AB vs. Svenska Cellulosa Aktiebolaget | Essity AB vs. ASSA ABLOY AB | Essity AB vs. AB Electrolux | Essity AB vs. AB SKF |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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