Correlation Between Lundin Energy and CH Robinson
Can any of the company-specific risk be diversified away by investing in both Lundin Energy and CH Robinson 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 Lundin Energy and CH Robinson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Energy AB and CH Robinson Worldwide, you can compare the effects of market volatilities on Lundin Energy and CH Robinson 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 Lundin Energy with a short position of CH Robinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Energy and CH Robinson.
Diversification Opportunities for Lundin Energy and CH Robinson
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lundin and CH1A is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Energy AB and CH Robinson Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Robinson Worldwide and Lundin Energy 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 Lundin Energy AB are associated (or correlated) with CH Robinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Robinson Worldwide has no effect on the direction of Lundin Energy i.e., Lundin Energy and CH Robinson go up and down completely randomly.
Pair Corralation between Lundin Energy and CH Robinson
Assuming the 90 days horizon Lundin Energy AB is expected to generate 1.21 times more return on investment than CH Robinson. However, Lundin Energy is 1.21 times more volatile than CH Robinson Worldwide. It trades about 0.13 of its potential returns per unit of risk. CH Robinson Worldwide is currently generating about -0.02 per unit of risk. If you would invest 55.00 in Lundin Energy AB on September 23, 2024 and sell it today you would earn a total of 4.00 from holding Lundin Energy AB or generate 7.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Lundin Energy AB vs. CH Robinson Worldwide
Performance |
Timeline |
Lundin Energy AB |
CH Robinson Worldwide |
Lundin Energy and CH Robinson Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lundin Energy and CH Robinson
The main advantage of trading using opposite Lundin Energy and CH Robinson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Energy position performs unexpectedly, CH Robinson 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 CH Robinson will offset losses from the drop in CH Robinson's long position.Lundin Energy vs. Entravision Communications | Lundin Energy vs. New Residential Investment | Lundin Energy vs. SEI INVESTMENTS | Lundin Energy vs. Mobilezone Holding AG |
CH Robinson vs. United Parcel Service | CH Robinson vs. Deutsche Post AG | CH Robinson vs. FedEx | CH Robinson vs. DSV Panalpina AS |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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