Correlation Between Online Brands and Qleanair Holding
Can any of the company-specific risk be diversified away by investing in both Online Brands and Qleanair Holding 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 Online Brands and Qleanair Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Online Brands Nordic and Qleanair Holding AB, you can compare the effects of market volatilities on Online Brands and Qleanair Holding 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 Online Brands with a short position of Qleanair Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Online Brands and Qleanair Holding.
Diversification Opportunities for Online Brands and Qleanair Holding
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Online and Qleanair is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Online Brands Nordic and Qleanair Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qleanair Holding and Online Brands 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 Online Brands Nordic are associated (or correlated) with Qleanair Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qleanair Holding has no effect on the direction of Online Brands i.e., Online Brands and Qleanair Holding go up and down completely randomly.
Pair Corralation between Online Brands and Qleanair Holding
Assuming the 90 days trading horizon Online Brands Nordic is expected to generate 1.84 times more return on investment than Qleanair Holding. However, Online Brands is 1.84 times more volatile than Qleanair Holding AB. It trades about 0.0 of its potential returns per unit of risk. Qleanair Holding AB is currently generating about -0.02 per unit of risk. If you would invest 1,545 in Online Brands Nordic on August 31, 2024 and sell it today you would lose (460.00) from holding Online Brands Nordic or give up 29.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Online Brands Nordic vs. Qleanair Holding AB
Performance |
| Timeline |
| Online Brands Nordic |
| Qleanair Holding |
Online Brands and Qleanair Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Online Brands and Qleanair Holding
The main advantage of trading using opposite Online Brands and Qleanair Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Online Brands position performs unexpectedly, Qleanair Holding 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 Qleanair Holding will offset losses from the drop in Qleanair Holding's long position.| Online Brands vs. NetJobs Group AB | Online Brands vs. Mantex AB | Online Brands vs. Doxa AB | Online Brands vs. Clean Motion AB |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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