Correlation Between BIMobject and Unibap AB

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

By analyzing existing cross correlation between BIMobject AB and Unibap AB, you can compare the effects of market volatilities on BIMobject and Unibap AB 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 BIMobject with a short position of Unibap AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIMobject and Unibap AB.

Diversification Opportunities for BIMobject and Unibap AB

0.13

Correlation Coefficient

BIMobject  Unibap AB

Average diversification

The 3 months correlation between BIMobject and Unibap is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding BIMobject AB and Unibap AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unibap AB and BIMobject 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 BIMobject AB are associated (or correlated) with Unibap AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unibap AB has no effect on the direction of BIMobject i.e., BIMobject and Unibap AB go up and down completely randomly.

Pair Corralation between BIMobject and Unibap AB

Assuming the 90 days trading horizon BIMobject AB is expected to generate 0.59 times more return on investment than Unibap AB. However, BIMobject AB is 1.7 times less risky than Unibap AB. It trades about 0.1 of its potential returns per unit of risk. Unibap AB is currently generating about 0.01 per unit of risk. If you would invest  242.00  in BIMobject AB on November 20, 2024 and sell it today you would earn a total of  446.00  from holding BIMobject AB or generate 184.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.74%
Values	Daily Returns

BIMobject AB  vs.  Unibap AB

BIMobject AB

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in BIMobject AB are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, BIMobject unveiled solid returns over the last few months and may actually be approaching a breakup point.

Unibap AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Unibap AB are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak forward indicators, Unibap AB sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BIMobject and Unibap AB

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

The idea behind BIMobject AB and Unibap AB 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.