Correlation Between Mohawk Industries and SEB SA
Can any of the company-specific risk be diversified away by investing in both Mohawk Industries and SEB SA 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 Mohawk Industries and SEB SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mohawk Industries and SEB SA, you can compare the effects of market volatilities on Mohawk Industries and SEB SA 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 Mohawk Industries with a short position of SEB SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mohawk Industries and SEB SA.
Diversification Opportunities for Mohawk Industries and SEB SA
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mohawk and SEB is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Mohawk Industries and SEB SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEB SA and Mohawk Industries 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 Mohawk Industries are associated (or correlated) with SEB SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEB SA has no effect on the direction of Mohawk Industries i.e., Mohawk Industries and SEB SA go up and down completely randomly.
Pair Corralation between Mohawk Industries and SEB SA
Considering the 90-day investment horizon Mohawk Industries is expected to under-perform the SEB SA. But the stock apears to be less risky and, when comparing its historical volatility, Mohawk Industries is 1.23 times less risky than SEB SA. The stock trades about -0.13 of its potential returns per unit of risk. The SEB SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 9,526 in SEB SA on December 2, 2024 and sell it today you would earn a total of 164.00 from holding SEB SA or generate 1.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 50.82% |
Values | Daily Returns |
Mohawk Industries vs. SEB SA
Performance |
Timeline |
Mohawk Industries |
SEB SA |
Mohawk Industries and SEB SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mohawk Industries and SEB SA
The main advantage of trading using opposite Mohawk Industries and SEB SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mohawk Industries position performs unexpectedly, SEB SA 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 SEB SA will offset losses from the drop in SEB SA's long position.Mohawk Industries vs. Bassett Furniture Industries | Mohawk Industries vs. Ethan Allen Interiors | Mohawk Industries vs. Natuzzi SpA | Mohawk Industries vs. Flexsteel Industries |
SEB SA vs. Zhihu Inc ADR | SEB SA vs. Idaho Strategic Resources | SEB SA vs. Coinbase Global | SEB SA vs. Black Mammoth Metals |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |