Correlation Between TRADEDOUBLER and ELECTROLUX
Can any of the company-specific risk be diversified away by investing in both TRADEDOUBLER and ELECTROLUX 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 TRADEDOUBLER and ELECTROLUX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRADEDOUBLER AB SK and ELECTROLUX B ADR2, you can compare the effects of market volatilities on TRADEDOUBLER and ELECTROLUX 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 TRADEDOUBLER with a short position of ELECTROLUX. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRADEDOUBLER and ELECTROLUX.
Diversification Opportunities for TRADEDOUBLER and ELECTROLUX
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TRADEDOUBLER and ELECTROLUX is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding TRADEDOUBLER AB SK and ELECTROLUX B ADR2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELECTROLUX B ADR2 and TRADEDOUBLER 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 TRADEDOUBLER AB SK are associated (or correlated) with ELECTROLUX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELECTROLUX B ADR2 has no effect on the direction of TRADEDOUBLER i.e., TRADEDOUBLER and ELECTROLUX go up and down completely randomly.
Pair Corralation between TRADEDOUBLER and ELECTROLUX
Assuming the 90 days horizon TRADEDOUBLER AB SK is expected to generate 1.17 times more return on investment than ELECTROLUX. However, TRADEDOUBLER is 1.17 times more volatile than ELECTROLUX B ADR2. It trades about 0.01 of its potential returns per unit of risk. ELECTROLUX B ADR2 is currently generating about -0.01 per unit of risk. If you would invest 32.00 in TRADEDOUBLER AB SK on September 13, 2024 and sell it today you would lose (6.00) from holding TRADEDOUBLER AB SK or give up 18.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TRADEDOUBLER AB SK vs. ELECTROLUX B ADR2
Performance |
| Timeline |
| TRADEDOUBLER AB SK |
| ELECTROLUX B ADR2 |
TRADEDOUBLER and ELECTROLUX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRADEDOUBLER and ELECTROLUX
The main advantage of trading using opposite TRADEDOUBLER and ELECTROLUX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRADEDOUBLER position performs unexpectedly, ELECTROLUX 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 ELECTROLUX will offset losses from the drop in ELECTROLUX's long position.| TRADEDOUBLER vs. Superior Plus Corp | TRADEDOUBLER vs. SIVERS SEMICONDUCTORS AB | TRADEDOUBLER vs. NorAm Drilling AS | TRADEDOUBLER vs. Norsk Hydro ASA |
| ELECTROLUX vs. AGF Management Limited | ELECTROLUX vs. Kaiser Aluminum | ELECTROLUX vs. CeoTronics AG | ELECTROLUX vs. MARKET VECTR RETAIL |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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