Correlation Between Ambu AS and Glunz Jensen

Can any of the company-specific risk be diversified away by investing in both Ambu AS and Glunz Jensen 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 Glunz Jensen into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ambu AS and Glunz Jensen, you can compare the effects of market volatilities on Ambu AS and Glunz Jensen 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 Glunz Jensen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambu AS and Glunz Jensen.

Diversification Opportunities for Ambu AS and Glunz Jensen

-0.11

Correlation Coefficient

Ambu AS  Glunz Jensen

Good diversification

The 3 months correlation between Ambu and Glunz is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ambu AS and Glunz Jensen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glunz Jensen 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 Glunz Jensen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glunz Jensen has no effect on the direction of Ambu AS i.e., Ambu AS and Glunz Jensen go up and down completely randomly.

Pair Corralation between Ambu AS and Glunz Jensen

Assuming the 90 days trading horizon Ambu AS is expected to generate 1.13 times more return on investment than Glunz Jensen. However, Ambu AS is 1.13 times more volatile than Glunz Jensen. It trades about 0.11 of its potential returns per unit of risk. Glunz Jensen is currently generating about -0.04 per unit of risk. If you would invest  10,400  in Ambu AS on December 29, 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 Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Ambu AS  vs.  Glunz Jensen

Ambu AS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ambu AS are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating fundamental drivers, Ambu AS sustained solid returns over the last few months and may actually be approaching a breakup point.

Glunz Jensen

Risk-Adjusted Performance

Very Weak

Over the last 90 days Glunz Jensen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Ambu AS and Glunz Jensen

The main advantage of trading using opposite Ambu AS and Glunz Jensen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambu AS position performs unexpectedly, Glunz Jensen 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 Glunz Jensen will offset losses from the drop in Glunz Jensen's long position.

The idea behind Ambu AS and Glunz Jensen 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.

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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.