Correlation Between Instalco Intressenter and Enersize
Can any of the company-specific risk be diversified away by investing in both Instalco Intressenter and Enersize 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 Instalco Intressenter and Enersize into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Instalco Intressenter AB and Enersize Oy, you can compare the effects of market volatilities on Instalco Intressenter and Enersize 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 Instalco Intressenter with a short position of Enersize. Check out your portfolio center. Please also check ongoing floating volatility patterns of Instalco Intressenter and Enersize.
Diversification Opportunities for Instalco Intressenter and Enersize
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Instalco and Enersize is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Instalco Intressenter AB and Enersize Oy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersize Oy and Instalco Intressenter 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 Instalco Intressenter AB are associated (or correlated) with Enersize. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersize Oy has no effect on the direction of Instalco Intressenter i.e., Instalco Intressenter and Enersize go up and down completely randomly.
Pair Corralation between Instalco Intressenter and Enersize
Assuming the 90 days trading horizon Instalco Intressenter AB is expected to generate 0.39 times more return on investment than Enersize. However, Instalco Intressenter AB is 2.58 times less risky than Enersize. It trades about 0.1 of its potential returns per unit of risk. Enersize Oy is currently generating about -0.24 per unit of risk. If you would invest 3,150 in Instalco Intressenter AB on September 26, 2024 and sell it today you would earn a total of 122.00 from holding Instalco Intressenter AB or generate 3.87% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Instalco Intressenter AB vs. Enersize Oy
Performance |
Timeline |
Instalco Intressenter |
Enersize Oy |
Instalco Intressenter and Enersize Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Instalco Intressenter and Enersize
The main advantage of trading using opposite Instalco Intressenter and Enersize positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Instalco Intressenter position performs unexpectedly, Enersize 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 Enersize will offset losses from the drop in Enersize's long position.Instalco Intressenter vs. Skanska AB | Instalco Intressenter vs. Sweco AB | Instalco Intressenter vs. Bravida Holding AB | Instalco Intressenter vs. Afry AB |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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