Correlation Between Peab AB and Online Brands
Can any of the company-specific risk be diversified away by investing in both Peab AB and Online Brands 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 Peab AB and Online Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peab AB and Online Brands Nordic, you can compare the effects of market volatilities on Peab AB and Online Brands 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 Peab AB with a short position of Online Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peab AB and Online Brands.
Diversification Opportunities for Peab AB and Online Brands
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Peab and Online is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Peab AB and Online Brands Nordic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Online Brands Nordic and Peab 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 Peab AB are associated (or correlated) with Online Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Online Brands Nordic has no effect on the direction of Peab AB i.e., Peab AB and Online Brands go up and down completely randomly.
Pair Corralation between Peab AB and Online Brands
Assuming the 90 days trading horizon Peab AB is expected to generate 0.44 times more return on investment than Online Brands. However, Peab AB is 2.25 times less risky than Online Brands. It trades about 0.11 of its potential returns per unit of risk. Online Brands Nordic is currently generating about 0.02 per unit of risk. If you would invest 4,072 in Peab AB on September 12, 2024 and sell it today you would earn a total of 4,108 from holding Peab AB or generate 100.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peab AB vs. Online Brands Nordic
Performance |
| Timeline |
| Peab AB |
| Online Brands Nordic |
Peab AB and Online Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peab AB and Online Brands
The main advantage of trading using opposite Peab AB and Online Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peab AB position performs unexpectedly, Online Brands 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 Online Brands will offset losses from the drop in Online Brands' long position.| Peab AB vs. Bravida Holding AB | Peab AB vs. Instalco Intressenter AB | Peab AB vs. NCC AB | Peab AB vs. Fasadgruppen Group AB |
| Online Brands vs. Clas Ohlson AB | Online Brands vs. Bilia AB | Online Brands vs. Byggmax Group AB | Online Brands vs. Peab 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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