Correlation Between ProfilGruppen and Svedbergs
Can any of the company-specific risk be diversified away by investing in both ProfilGruppen and Svedbergs 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 ProfilGruppen and Svedbergs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ProfilGruppen AB and Svedbergs i Dalstorp, you can compare the effects of market volatilities on ProfilGruppen and Svedbergs 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 ProfilGruppen with a short position of Svedbergs. Check out your portfolio center. Please also check ongoing floating volatility patterns of ProfilGruppen and Svedbergs.
Diversification Opportunities for ProfilGruppen and Svedbergs
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ProfilGruppen and Svedbergs is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding ProfilGruppen AB and Svedbergs i Dalstorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Svedbergs i Dalstorp and ProfilGruppen 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 ProfilGruppen AB are associated (or correlated) with Svedbergs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Svedbergs i Dalstorp has no effect on the direction of ProfilGruppen i.e., ProfilGruppen and Svedbergs go up and down completely randomly.
Pair Corralation between ProfilGruppen and Svedbergs
Assuming the 90 days trading horizon ProfilGruppen AB is expected to generate 1.49 times more return on investment than Svedbergs. However, ProfilGruppen is 1.49 times more volatile than Svedbergs i Dalstorp. It trades about 0.22 of its potential returns per unit of risk. Svedbergs i Dalstorp is currently generating about 0.05 per unit of risk. If you would invest 10,050 in ProfilGruppen AB on November 3, 2024 and sell it today you would earn a total of 1,000.00 from holding ProfilGruppen AB or generate 9.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ProfilGruppen AB vs. Svedbergs i Dalstorp
Performance |
| Timeline |
| ProfilGruppen AB |
| Svedbergs i Dalstorp |
ProfilGruppen and Svedbergs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ProfilGruppen and Svedbergs
The main advantage of trading using opposite ProfilGruppen and Svedbergs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ProfilGruppen position performs unexpectedly, Svedbergs 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 Svedbergs will offset losses from the drop in Svedbergs' long position.| ProfilGruppen vs. Svedbergs i Dalstorp | ProfilGruppen vs. Softronic AB | ProfilGruppen vs. Novotek AB | ProfilGruppen vs. Prevas AB |
| Svedbergs vs. Systemair AB | Svedbergs vs. Softronic AB | Svedbergs vs. Inwido AB | Svedbergs vs. Lindab International 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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