Correlation Between Mekonomen and Checkin Group
Can any of the company-specific risk be diversified away by investing in both Mekonomen and Checkin Group 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 Mekonomen and Checkin Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mekonomen AB and Checkin Group AB, you can compare the effects of market volatilities on Mekonomen and Checkin Group 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 Mekonomen with a short position of Checkin Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mekonomen and Checkin Group.
Diversification Opportunities for Mekonomen and Checkin Group
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mekonomen and Checkin is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Mekonomen AB and Checkin Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Checkin Group AB and Mekonomen 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 Mekonomen AB are associated (or correlated) with Checkin Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Checkin Group AB has no effect on the direction of Mekonomen i.e., Mekonomen and Checkin Group go up and down completely randomly.
Pair Corralation between Mekonomen and Checkin Group
Assuming the 90 days trading horizon Mekonomen AB is expected to generate 0.45 times more return on investment than Checkin Group. However, Mekonomen AB is 2.21 times less risky than Checkin Group. It trades about -0.02 of its potential returns per unit of risk. Checkin Group AB is currently generating about -0.28 per unit of risk. If you would invest 13,200 in Mekonomen AB on September 26, 2024 and sell it today you would lose (140.00) from holding Mekonomen AB or give up 1.06% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Mekonomen AB vs. Checkin Group AB
Performance |
Timeline |
Mekonomen AB |
Checkin Group AB |
Mekonomen and Checkin Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mekonomen and Checkin Group
The main advantage of trading using opposite Mekonomen and Checkin Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mekonomen position performs unexpectedly, Checkin Group 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 Checkin Group will offset losses from the drop in Checkin Group's long position.The idea behind Mekonomen AB and Checkin Group 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.Checkin Group vs. Bambuser AB | Checkin Group vs. Cint Group AB | Checkin Group vs. Sinch AB | Checkin Group vs. Surgical Science Sweden |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Transaction History View history of all your transactions and understand their impact on performance |