Correlation Between Wallenstam and Byggmstare Anders
Can any of the company-specific risk be diversified away by investing in both Wallenstam and Byggmstare Anders 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 Wallenstam and Byggmstare Anders into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wallenstam AB and Byggmstare Anders J, you can compare the effects of market volatilities on Wallenstam and Byggmstare Anders 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 Wallenstam with a short position of Byggmstare Anders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallenstam and Byggmstare Anders.
Diversification Opportunities for Wallenstam and Byggmstare Anders
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wallenstam and Byggmstare is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Wallenstam AB and Byggmstare Anders J in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Byggmstare Anders and Wallenstam 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 Wallenstam AB are associated (or correlated) with Byggmstare Anders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Byggmstare Anders has no effect on the direction of Wallenstam i.e., Wallenstam and Byggmstare Anders go up and down completely randomly.
Pair Corralation between Wallenstam and Byggmstare Anders
Assuming the 90 days trading horizon Wallenstam AB is expected to generate 0.69 times more return on investment than Byggmstare Anders. However, Wallenstam AB is 1.45 times less risky than Byggmstare Anders. It trades about 0.07 of its potential returns per unit of risk. Byggmstare Anders J is currently generating about -0.18 per unit of risk. If you would invest 4,716 in Wallenstam AB on November 28, 2024 and sell it today you would earn a total of 92.00 from holding Wallenstam AB or generate 1.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wallenstam AB vs. Byggmstare Anders J
Performance |
| Timeline |
| Wallenstam AB |
| Byggmstare Anders |
Wallenstam and Byggmstare Anders Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wallenstam and Byggmstare Anders
The main advantage of trading using opposite Wallenstam and Byggmstare Anders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wallenstam position performs unexpectedly, Byggmstare Anders 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 Byggmstare Anders will offset losses from the drop in Byggmstare Anders' long position.| Wallenstam vs. Fabege AB | Wallenstam vs. Fastighets AB Balder | Wallenstam vs. Hufvudstaden AB | Wallenstam vs. Castellum AB |
| Byggmstare Anders vs. Creades AB | Byggmstare Anders vs. ALM Equity AB | Byggmstare Anders vs. Brinova Fastigheter AB | Byggmstare Anders vs. Awardit 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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