Correlation Between Svenska Handelsbanken and Bonzun AB
Can any of the company-specific risk be diversified away by investing in both Svenska Handelsbanken and Bonzun AB 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 Svenska Handelsbanken and Bonzun AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Svenska Handelsbanken AB and Bonzun AB, you can compare the effects of market volatilities on Svenska Handelsbanken and Bonzun AB 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 Svenska Handelsbanken with a short position of Bonzun AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svenska Handelsbanken and Bonzun AB.
Diversification Opportunities for Svenska Handelsbanken and Bonzun AB
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Svenska and Bonzun is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Svenska Handelsbanken AB and Bonzun AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonzun AB and Svenska Handelsbanken 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 Svenska Handelsbanken AB are associated (or correlated) with Bonzun AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonzun AB has no effect on the direction of Svenska Handelsbanken i.e., Svenska Handelsbanken and Bonzun AB go up and down completely randomly.
Pair Corralation between Svenska Handelsbanken and Bonzun AB
Assuming the 90 days trading horizon Svenska Handelsbanken AB is expected to generate 0.17 times more return on investment than Bonzun AB. However, Svenska Handelsbanken AB is 5.99 times less risky than Bonzun AB. It trades about 0.11 of its potential returns per unit of risk. Bonzun AB is currently generating about -0.08 per unit of risk. If you would invest 12,150 in Svenska Handelsbanken AB on September 1, 2024 and sell it today you would earn a total of 2,420 from holding Svenska Handelsbanken AB or generate 19.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.22% |
| Values | Daily Returns |
Svenska Handelsbanken AB vs. Bonzun AB
Performance |
| Timeline |
| Svenska Handelsbanken |
| Bonzun AB |
Svenska Handelsbanken and Bonzun AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Svenska Handelsbanken and Bonzun AB
The main advantage of trading using opposite Svenska Handelsbanken and Bonzun AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svenska Handelsbanken position performs unexpectedly, Bonzun AB 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 Bonzun AB will offset losses from the drop in Bonzun AB's long position.| Svenska Handelsbanken vs. Svenska Handelsbanken AB | Svenska Handelsbanken vs. Nordea Bank Abp | Svenska Handelsbanken vs. Atlas Copco AB | Svenska Handelsbanken vs. Skandinaviska Enskilda Banken |
| Bonzun AB vs. AVTECH Sweden AB | Bonzun AB vs. K2A Knaust Andersson | Bonzun AB vs. eEducation Albert AB | Bonzun AB vs. Footway 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |