Correlation Between OMX Stockholm and VBG Group
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By analyzing existing cross correlation between OMX Stockholm Mid and VBG Group AB, you can compare the effects of market volatilities on OMX Stockholm and VBG 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 OMX Stockholm with a short position of VBG Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and VBG Group.
Diversification Opportunities for OMX Stockholm and VBG Group
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between OMX and VBG is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and VBG Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VBG Group AB 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 VBG Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VBG Group AB has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and VBG Group go up and down completely randomly.
Pair Corralation between OMX Stockholm and VBG Group
Assuming the 90 days trading horizon OMX Stockholm is expected to generate 4.16 times less return on investment than VBG Group. But when comparing it to its historical volatility, OMX Stockholm Mid is 2.42 times less risky than VBG Group. It trades about 0.05 of its potential returns per unit of risk. VBG Group AB is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13,746 in VBG Group AB on August 24, 2024 and sell it today you would earn a total of 15,354 from holding VBG Group AB or generate 111.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
OMX Stockholm Mid vs. VBG Group AB
Performance |
| Timeline |
OMX Stockholm and VBG Group Volatility Contrast
Predicted Return Density |
| Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
VBG Group AB
Pair trading matchups for VBG Group
Pair Trading with OMX Stockholm and VBG Group
The main advantage of trading using opposite OMX Stockholm and VBG Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, VBG 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 VBG Group will offset losses from the drop in VBG Group's long position.| OMX Stockholm vs. SaltX Technology Holding | OMX Stockholm vs. Addtech AB | OMX Stockholm vs. Upsales Technology AB | OMX Stockholm vs. Bio Works Technologies AB |
| VBG Group vs. Inwido AB | VBG Group vs. Proact IT Group | VBG Group vs. New Wave Group | VBG Group vs. Systemair 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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