Correlation Between Vestum AB and Lifco AB
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By analyzing existing cross correlation between Vestum AB and Lifco AB, you can compare the effects of market volatilities on Vestum AB and Lifco 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 Vestum AB with a short position of Lifco AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vestum AB and Lifco AB.
Diversification Opportunities for Vestum AB and Lifco AB
Good diversification
The 3 months correlation between Vestum and Lifco is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Vestum AB and Lifco AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifco AB and Vestum AB 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 Vestum AB are associated (or correlated) with Lifco AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifco AB has no effect on the direction of Vestum AB i.e., Vestum AB and Lifco AB go up and down completely randomly.
Pair Corralation between Vestum AB and Lifco AB
Assuming the 90 days trading horizon Vestum AB is expected to generate 1.1 times less return on investment than Lifco AB. In addition to that, Vestum AB is 1.74 times more volatile than Lifco AB. It trades about 0.03 of its total potential returns per unit of risk. Lifco AB is currently generating about 0.07 per unit of volatility. If you would invest 28,020 in Lifco AB on August 26, 2024 and sell it today you would earn a total of 3,800 from holding Lifco AB or generate 13.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vestum AB vs. Lifco AB
Performance |
| Timeline |
| Vestum AB |
| Lifco AB |
Vestum AB and Lifco AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vestum AB and Lifco AB
The main advantage of trading using opposite Vestum AB and Lifco AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vestum AB position performs unexpectedly, Lifco 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 Lifco AB will offset losses from the drop in Lifco AB's long position.| Vestum AB vs. Lifco AB | Vestum AB vs. Sdiptech AB | Vestum AB vs. Vitec Software Group | Vestum AB vs. Addtech AB |
| Lifco AB vs. Indutrade AB | Lifco AB vs. Addtech AB | Lifco AB vs. Teqnion AB | Lifco AB vs. Vitec Software Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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