Correlation Between XXL ASA and Elektroimportoren
Can any of the company-specific risk be diversified away by investing in both XXL ASA and Elektroimportoren 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 XXL ASA and Elektroimportoren into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XXL ASA and Elektroimportoren As, you can compare the effects of market volatilities on XXL ASA and Elektroimportoren 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 XXL ASA with a short position of Elektroimportoren. Check out your portfolio center. Please also check ongoing floating volatility patterns of XXL ASA and Elektroimportoren.
Diversification Opportunities for XXL ASA and Elektroimportoren
-0.96 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between XXL and Elektroimportoren is -0.96. Overlapping area represents the amount of risk that can be diversified away by holding XXL ASA and Elektroimportoren As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elektroimportoren and XXL ASA 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 XXL ASA are associated (or correlated) with Elektroimportoren. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elektroimportoren has no effect on the direction of XXL ASA i.e., XXL ASA and Elektroimportoren go up and down completely randomly.
Pair Corralation between XXL ASA and Elektroimportoren
Assuming the 90 days trading horizon XXL ASA is expected to under-perform the Elektroimportoren. In addition to that, XXL ASA is 3.75 times more volatile than Elektroimportoren As. It trades about -0.36 of its total potential returns per unit of risk. Elektroimportoren As is currently generating about 0.29 per unit of volatility. If you would invest 1,005 in Elektroimportoren As on September 1, 2024 and sell it today you would earn a total of 315.00 from holding Elektroimportoren As or generate 31.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
XXL ASA vs. Elektroimportoren As
Performance |
| Timeline |
| XXL ASA |
| Elektroimportoren |
XXL ASA and Elektroimportoren Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XXL ASA and Elektroimportoren
The main advantage of trading using opposite XXL ASA and Elektroimportoren positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XXL ASA position performs unexpectedly, Elektroimportoren 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 Elektroimportoren will offset losses from the drop in Elektroimportoren's long position.The idea behind XXL ASA and Elektroimportoren As pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Elektroimportoren vs. Europris ASA | Elektroimportoren vs. Kid ASA | Elektroimportoren vs. XXL ASA | Elektroimportoren vs. Kitron ASA |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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