Correlation Between Pexip Holding and Link Mobility
Can any of the company-specific risk be diversified away by investing in both Pexip Holding and Link Mobility 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 Pexip Holding and Link Mobility into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pexip Holding ASA and Link Mobility Group, you can compare the effects of market volatilities on Pexip Holding and Link Mobility 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 Pexip Holding with a short position of Link Mobility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pexip Holding and Link Mobility.
Diversification Opportunities for Pexip Holding and Link Mobility
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pexip and Link is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pexip Holding ASA and Link Mobility Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Link Mobility Group and Pexip Holding 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 Pexip Holding ASA are associated (or correlated) with Link Mobility. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Link Mobility Group has no effect on the direction of Pexip Holding i.e., Pexip Holding and Link Mobility go up and down completely randomly.
Pair Corralation between Pexip Holding and Link Mobility
Assuming the 90 days trading horizon Pexip Holding ASA is expected to generate 1.06 times more return on investment than Link Mobility. However, Pexip Holding is 1.06 times more volatile than Link Mobility Group. It trades about 0.12 of its potential returns per unit of risk. Link Mobility Group is currently generating about 0.09 per unit of risk. If you would invest 2,694 in Pexip Holding ASA on August 27, 2024 and sell it today you would earn a total of 1,616 from holding Pexip Holding ASA or generate 59.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pexip Holding ASA vs. Link Mobility Group
Performance |
| Timeline |
| Pexip Holding ASA |
| Link Mobility Group |
Pexip Holding and Link Mobility Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pexip Holding and Link Mobility
The main advantage of trading using opposite Pexip Holding and Link Mobility positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pexip Holding position performs unexpectedly, Link Mobility 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 Link Mobility will offset losses from the drop in Link Mobility's long position.| Pexip Holding vs. Elliptic Laboratories AS | Pexip Holding vs. Elkem ASA | Pexip Holding vs. Vow ASA | Pexip Holding vs. North Energy ASA |
| Link Mobility vs. Crayon Group Holding | Link Mobility vs. NRC Group ASA | Link Mobility vs. Pexip Holding ASA | Link Mobility vs. Europris ASA |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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