Correlation Between VIMAB Group and Enersize
Can any of the company-specific risk be diversified away by investing in both VIMAB Group and Enersize 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 VIMAB Group and Enersize into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VIMAB Group AB and Enersize Oy, you can compare the effects of market volatilities on VIMAB Group and Enersize 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 VIMAB Group with a short position of Enersize. Check out your portfolio center. Please also check ongoing floating volatility patterns of VIMAB Group and Enersize.
Diversification Opportunities for VIMAB Group and Enersize
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between VIMAB and Enersize is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding VIMAB Group AB and Enersize Oy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersize Oy and VIMAB Group 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 VIMAB Group AB are associated (or correlated) with Enersize. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersize Oy has no effect on the direction of VIMAB Group i.e., VIMAB Group and Enersize go up and down completely randomly.
Pair Corralation between VIMAB Group and Enersize
Assuming the 90 days trading horizon VIMAB Group AB is expected to under-perform the Enersize. But the stock apears to be less risky and, when comparing its historical volatility, VIMAB Group AB is 1.45 times less risky than Enersize. The stock trades about -0.37 of its potential returns per unit of risk. The Enersize Oy is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 0.75 in Enersize Oy on August 30, 2024 and sell it today you would lose (0.18) from holding Enersize Oy or give up 24.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VIMAB Group AB vs. Enersize Oy
Performance |
| Timeline |
| VIMAB Group AB |
| Enersize Oy |
VIMAB Group and Enersize Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VIMAB Group and Enersize
The main advantage of trading using opposite VIMAB Group and Enersize positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIMAB Group position performs unexpectedly, Enersize 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 Enersize will offset losses from the drop in Enersize's long position.| VIMAB Group vs. Vitec Software Group | VIMAB Group vs. Invisio Communications AB | VIMAB Group vs. Qleanair Holding AB | VIMAB Group vs. Upsales Technology 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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