Correlation Between AB Volvo and Sinotruk (Hong
Can any of the company-specific risk be diversified away by investing in both AB Volvo and Sinotruk (Hong 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 AB Volvo and Sinotruk (Hong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AB Volvo and Sinotruk Limited, you can compare the effects of market volatilities on AB Volvo and Sinotruk (Hong 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 AB Volvo with a short position of Sinotruk (Hong. Check out your portfolio center. Please also check ongoing floating volatility patterns of AB Volvo and Sinotruk (Hong.
Diversification Opportunities for AB Volvo and Sinotruk (Hong
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between VOL3 and Sinotruk is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding AB Volvo and Sinotruk Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinotruk Limited and AB Volvo 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 AB Volvo are associated (or correlated) with Sinotruk (Hong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinotruk Limited has no effect on the direction of AB Volvo i.e., AB Volvo and Sinotruk (Hong go up and down completely randomly.
Pair Corralation between AB Volvo and Sinotruk (Hong
Assuming the 90 days trading horizon AB Volvo is expected to generate 0.71 times more return on investment than Sinotruk (Hong. However, AB Volvo is 1.42 times less risky than Sinotruk (Hong. It trades about 0.25 of its potential returns per unit of risk. Sinotruk Limited is currently generating about 0.06 per unit of risk. If you would invest 2,392 in AB Volvo on November 7, 2024 and sell it today you would earn a total of 292.00 from holding AB Volvo or generate 12.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
AB Volvo vs. Sinotruk Limited
Performance |
| Timeline |
| AB Volvo |
| Sinotruk Limited |
AB Volvo and Sinotruk (Hong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AB Volvo and Sinotruk (Hong
The main advantage of trading using opposite AB Volvo and Sinotruk (Hong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AB Volvo position performs unexpectedly, Sinotruk (Hong 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 Sinotruk (Hong will offset losses from the drop in Sinotruk (Hong's long position.| AB Volvo vs. EVS Broadcast Equipment | AB Volvo vs. BII Railway Transportation | AB Volvo vs. Penta Ocean Construction Co | AB Volvo vs. Kaufman Broad SA |
| Sinotruk (Hong vs. AB Volvo | Sinotruk (Hong vs. PACCAR Inc | Sinotruk (Hong vs. KION Group AG | Sinotruk (Hong vs. Wabash National |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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