Correlation Between CARSALESCOM and Electrolux Professional
Can any of the company-specific risk be diversified away by investing in both CARSALESCOM and Electrolux Professional 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 CARSALESCOM and Electrolux Professional into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CARSALESCOM and Electrolux Professional AB, you can compare the effects of market volatilities on CARSALESCOM and Electrolux Professional 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 CARSALESCOM with a short position of Electrolux Professional. Check out your portfolio center. Please also check ongoing floating volatility patterns of CARSALESCOM and Electrolux Professional.
Diversification Opportunities for CARSALESCOM and Electrolux Professional
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CARSALESCOM and Electrolux is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding CARSALESCOM and Electrolux Professional AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electrolux Professional and CARSALESCOM 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 CARSALESCOM are associated (or correlated) with Electrolux Professional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electrolux Professional has no effect on the direction of CARSALESCOM i.e., CARSALESCOM and Electrolux Professional go up and down completely randomly.
Pair Corralation between CARSALESCOM and Electrolux Professional
Assuming the 90 days trading horizon CARSALESCOM is expected to under-perform the Electrolux Professional. But the stock apears to be less risky and, when comparing its historical volatility, CARSALESCOM is 1.51 times less risky than Electrolux Professional. The stock trades about -0.11 of its potential returns per unit of risk. The Electrolux Professional AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 593.00 in Electrolux Professional AB on September 14, 2024 and sell it today you would earn a total of 5.00 from holding Electrolux Professional AB or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CARSALESCOM vs. Electrolux Professional AB
Performance |
| Timeline |
| CARSALESCOM |
| Electrolux Professional |
CARSALESCOM and Electrolux Professional Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CARSALESCOM and Electrolux Professional
The main advantage of trading using opposite CARSALESCOM and Electrolux Professional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CARSALESCOM position performs unexpectedly, Electrolux Professional 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 Electrolux Professional will offset losses from the drop in Electrolux Professional's long position.| CARSALESCOM vs. Apple Inc | CARSALESCOM vs. Apple Inc | CARSALESCOM vs. Apple Inc | CARSALESCOM vs. Apple Inc |
| Electrolux Professional vs. PACIFIC ONLINE | Electrolux Professional vs. SLR Investment Corp | Electrolux Professional vs. AOYAMA TRADING | Electrolux Professional vs. CARSALESCOM |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |