Correlation Between OMX Stockholm and Industrivarden
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By analyzing existing cross correlation between OMX Stockholm Mid and Industrivarden AB ser, you can compare the effects of market volatilities on OMX Stockholm and Industrivarden 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 OMX Stockholm with a short position of Industrivarden. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and Industrivarden.
Diversification Opportunities for OMX Stockholm and Industrivarden
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between OMX and Industrivarden is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and Industrivarden AB ser in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrivarden AB ser and OMX Stockholm 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 OMX Stockholm Mid are associated (or correlated) with Industrivarden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrivarden AB ser has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and Industrivarden go up and down completely randomly.
Pair Corralation between OMX Stockholm and Industrivarden
Assuming the 90 days trading horizon OMX Stockholm Mid is expected to under-perform the Industrivarden. But the index apears to be less risky and, when comparing its historical volatility, OMX Stockholm Mid is 1.44 times less risky than Industrivarden. The index trades about -0.2 of its potential returns per unit of risk. The Industrivarden AB ser is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest 37,340 in Industrivarden AB ser on August 28, 2024 and sell it today you would lose (1,190) from holding Industrivarden AB ser or give up 3.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OMX Stockholm Mid vs. Industrivarden AB ser
Performance |
| Timeline |
OMX Stockholm and Industrivarden Volatility Contrast
Predicted Return Density |
| Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
Industrivarden AB ser
Pair trading matchups for Industrivarden
Pair Trading with OMX Stockholm and Industrivarden
The main advantage of trading using opposite OMX Stockholm and Industrivarden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, Industrivarden 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 Industrivarden will offset losses from the drop in Industrivarden's long position.| OMX Stockholm vs. Skandinaviska Enskilda Banken | OMX Stockholm vs. Indutrade AB | OMX Stockholm vs. Arion banki hf | OMX Stockholm vs. Fractal Gaming Group |
| Industrivarden vs. Investor AB ser | Industrivarden vs. L E Lundbergfretagen | Industrivarden vs. Kinnevik Investment AB | Industrivarden vs. Investment AB Latour |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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