Correlation Between Resurs Holding and Transtema Group
Can any of the company-specific risk be diversified away by investing in both Resurs Holding and Transtema Group 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 Resurs Holding and Transtema Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Resurs Holding AB and Transtema Group AB, you can compare the effects of market volatilities on Resurs Holding and Transtema 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 Resurs Holding with a short position of Transtema Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Resurs Holding and Transtema Group.
Diversification Opportunities for Resurs Holding and Transtema Group
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Resurs and Transtema is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Resurs Holding AB and Transtema Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transtema Group AB and Resurs 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 Resurs Holding AB are associated (or correlated) with Transtema Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transtema Group AB has no effect on the direction of Resurs Holding i.e., Resurs Holding and Transtema Group go up and down completely randomly.
Pair Corralation between Resurs Holding and Transtema Group
Assuming the 90 days trading horizon Resurs Holding AB is not expected to generate positive returns. However, Resurs Holding AB is 83.64 times less risky than Transtema Group. It waists most of its returns potential to compensate for thr risk taken. Transtema Group is generating about -0.16 per unit of risk. If you would invest 2,350 in Resurs Holding AB on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Resurs Holding AB or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Resurs Holding AB vs. Transtema Group AB
Performance |
| Timeline |
| Resurs Holding AB |
| Transtema Group AB |
Resurs Holding and Transtema Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Resurs Holding and Transtema Group
The main advantage of trading using opposite Resurs Holding and Transtema Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Resurs Holding position performs unexpectedly, Transtema 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 Transtema Group will offset losses from the drop in Transtema Group's long position.| Resurs Holding vs. Koninklijke Heijmans NV | Resurs Holding vs. Trelleborg AB | Resurs Holding vs. Ferronordic AB | Resurs Holding vs. KABE Group AB |
| Transtema Group vs. Humble Group AB | Transtema Group vs. Enad Global 7 | Transtema Group vs. Goodbye Kansas Group | Transtema Group vs. KABE Group 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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