Correlation Between Viva Wine and Peab AB
Can any of the company-specific risk be diversified away by investing in both Viva Wine and Peab 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 Viva Wine and Peab AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viva Wine Group and Peab AB, you can compare the effects of market volatilities on Viva Wine and Peab 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 Viva Wine with a short position of Peab AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viva Wine and Peab AB.
Diversification Opportunities for Viva Wine and Peab AB
Very weak diversification
The 3 months correlation between Viva and Peab is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Viva Wine Group and Peab AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peab AB and Viva Wine 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 Viva Wine Group are associated (or correlated) with Peab AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peab AB has no effect on the direction of Viva Wine i.e., Viva Wine and Peab AB go up and down completely randomly.
Pair Corralation between Viva Wine and Peab AB
Assuming the 90 days trading horizon Viva Wine Group is expected to under-perform the Peab AB. But the stock apears to be less risky and, when comparing its historical volatility, Viva Wine Group is 1.08 times less risky than Peab AB. The stock trades about -0.06 of its potential returns per unit of risk. The Peab AB is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 7,320 in Peab AB on November 3, 2024 and sell it today you would earn a total of 655.00 from holding Peab AB or generate 8.95% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Viva Wine Group vs. Peab AB
Performance |
Timeline |
Viva Wine Group |
Peab AB |
Viva Wine and Peab AB Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Viva Wine and Peab AB
The main advantage of trading using opposite Viva Wine and Peab AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viva Wine position performs unexpectedly, Peab 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 Peab AB will offset losses from the drop in Peab AB's long position.Viva Wine vs. Cint Group AB | Viva Wine vs. Nordic Waterproofing Holding | Viva Wine vs. RVRC Holding AB | Viva Wine vs. Synsam AB |
Peab AB vs. Swedbank AB | Peab AB vs. Serstech AB | Peab AB vs. Kinnevik Investment AB | Peab AB vs. Arion banki hf |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance |