Correlation Between Vitrolife and Probi AB
Can any of the company-specific risk be diversified away by investing in both Vitrolife and Probi 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 Vitrolife and Probi AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vitrolife AB and Probi AB, you can compare the effects of market volatilities on Vitrolife and Probi 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 Vitrolife with a short position of Probi AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vitrolife and Probi AB.
Diversification Opportunities for Vitrolife and Probi AB
Very good diversification
The 3 months correlation between Vitrolife and Probi is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Vitrolife AB and Probi AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Probi AB and Vitrolife 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 Vitrolife AB are associated (or correlated) with Probi AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Probi AB has no effect on the direction of Vitrolife i.e., Vitrolife and Probi AB go up and down completely randomly.
Pair Corralation between Vitrolife and Probi AB
Assuming the 90 days trading horizon Vitrolife is expected to generate 1.95 times less return on investment than Probi AB. But when comparing it to its historical volatility, Vitrolife AB is 1.08 times less risky than Probi AB. It trades about 0.03 of its potential returns per unit of risk. Probi AB is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 20,424 in Probi AB on August 29, 2024 and sell it today you would earn a total of 14,276 from holding Probi AB or generate 69.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vitrolife AB vs. Probi AB
Performance |
| Timeline |
| Vitrolife AB |
| Probi AB |
Vitrolife and Probi AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vitrolife and Probi AB
The main advantage of trading using opposite Vitrolife and Probi AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vitrolife position performs unexpectedly, Probi 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 Probi AB will offset losses from the drop in Probi AB's long position.| Vitrolife vs. I Tech | Vitrolife vs. Online Brands Nordic | Vitrolife vs. Nitro Games Oyj | Vitrolife vs. SolTech Energy Sweden |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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