Correlation Between Ambu AS and Eolus Vind
Can any of the company-specific risk be diversified away by investing in both Ambu AS and Eolus Vind 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 Ambu AS and Eolus Vind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambu AS and Eolus Vind AB, you can compare the effects of market volatilities on Ambu AS and Eolus Vind 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 Ambu AS with a short position of Eolus Vind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambu AS and Eolus Vind.
Diversification Opportunities for Ambu AS and Eolus Vind
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ambu and Eolus is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Ambu AS and Eolus Vind AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eolus Vind AB and Ambu AS 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 Ambu AS are associated (or correlated) with Eolus Vind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eolus Vind AB has no effect on the direction of Ambu AS i.e., Ambu AS and Eolus Vind go up and down completely randomly.
Pair Corralation between Ambu AS and Eolus Vind
Assuming the 90 days trading horizon Ambu AS is expected to generate 0.86 times more return on investment than Eolus Vind. However, Ambu AS is 1.16 times less risky than Eolus Vind. It trades about 0.11 of its potential returns per unit of risk. Eolus Vind AB is currently generating about 0.07 per unit of risk. If you would invest 10,400 in Ambu AS on December 30, 2024 and sell it today you would earn a total of 1,970 from holding Ambu AS or generate 18.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Ambu AS vs. Eolus Vind AB
Performance |
Timeline |
Ambu AS |
Eolus Vind AB |
Ambu AS and Eolus Vind Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ambu AS and Eolus Vind
The main advantage of trading using opposite Ambu AS and Eolus Vind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambu AS position performs unexpectedly, Eolus Vind 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 Eolus Vind will offset losses from the drop in Eolus Vind's long position.Ambu AS vs. Bavarian Nordic | Ambu AS vs. Genmab AS | Ambu AS vs. GN Store Nord | Ambu AS vs. DSV Panalpina AS |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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