Correlation Between VNV Global and L E
Can any of the company-specific risk be diversified away by investing in both VNV Global and L E 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 VNV Global and L E into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VNV Global AB and L E Lundbergfretagen, you can compare the effects of market volatilities on VNV Global and L E 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 VNV Global with a short position of L E. Check out your portfolio center. Please also check ongoing floating volatility patterns of VNV Global and L E.
Diversification Opportunities for VNV Global and L E
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VNV and LUND-B is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding VNV Global AB and L E Lundbergfretagen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L E Lundbergfretagen and VNV Global 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 VNV Global AB are associated (or correlated) with L E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L E Lundbergfretagen has no effect on the direction of VNV Global i.e., VNV Global and L E go up and down completely randomly.
Pair Corralation between VNV Global and L E
Assuming the 90 days trading horizon VNV Global AB is expected to under-perform the L E. In addition to that, VNV Global is 2.7 times more volatile than L E Lundbergfretagen. It trades about -0.01 of its total potential returns per unit of risk. L E Lundbergfretagen is currently generating about 0.04 per unit of volatility. If you would invest 43,674 in L E Lundbergfretagen on September 12, 2024 and sell it today you would earn a total of 9,176 from holding L E Lundbergfretagen or generate 21.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VNV Global AB vs. L E Lundbergfretagen
Performance |
| Timeline |
| VNV Global AB |
| L E Lundbergfretagen |
VNV Global and L E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VNV Global and L E
The main advantage of trading using opposite VNV Global and L E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VNV Global position performs unexpectedly, L E 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 L E will offset losses from the drop in L E's long position.| VNV Global vs. Catella AB | VNV Global vs. Catella AB A | VNV Global vs. KABE Group AB | VNV Global vs. IAR Systems Group |
| L E vs. Investment AB Latour | L E vs. Industrivarden AB ser | L E vs. Kinnevik Investment AB | L E vs. Investor AB ser |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |