Correlation Between Axfood AB and BillerudKorsnas
Can any of the company-specific risk be diversified away by investing in both Axfood AB and BillerudKorsnas 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 Axfood AB and BillerudKorsnas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axfood AB and BillerudKorsnas AB, you can compare the effects of market volatilities on Axfood AB and BillerudKorsnas 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 Axfood AB with a short position of BillerudKorsnas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axfood AB and BillerudKorsnas.
Diversification Opportunities for Axfood AB and BillerudKorsnas
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Axfood and BillerudKorsnas is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Axfood AB and BillerudKorsnas AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BillerudKorsnas AB and Axfood AB 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 Axfood AB are associated (or correlated) with BillerudKorsnas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BillerudKorsnas AB has no effect on the direction of Axfood AB i.e., Axfood AB and BillerudKorsnas go up and down completely randomly.
Pair Corralation between Axfood AB and BillerudKorsnas
Assuming the 90 days trading horizon Axfood AB is expected to under-perform the BillerudKorsnas. But the stock apears to be less risky and, when comparing its historical volatility, Axfood AB is 1.24 times less risky than BillerudKorsnas. The stock trades about -0.13 of its potential returns per unit of risk. The BillerudKorsnas AB is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 10,390 in BillerudKorsnas AB on September 12, 2024 and sell it today you would lose (545.00) from holding BillerudKorsnas AB or give up 5.25% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Axfood AB vs. BillerudKorsnas AB
Performance |
Timeline |
Axfood AB |
BillerudKorsnas AB |
Axfood AB and BillerudKorsnas Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Axfood AB and BillerudKorsnas
The main advantage of trading using opposite Axfood AB and BillerudKorsnas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axfood AB position performs unexpectedly, BillerudKorsnas 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 BillerudKorsnas will offset losses from the drop in BillerudKorsnas' long position.Axfood AB vs. Castellum AB | Axfood AB vs. Tele2 AB | Axfood AB vs. Investor AB ser | Axfood AB vs. Kinnevik Investment AB |
BillerudKorsnas vs. SSAB AB | BillerudKorsnas vs. Svenska Cellulosa Aktiebolaget | BillerudKorsnas vs. Axfood AB | BillerudKorsnas vs. Proact IT Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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