Correlation Between Xplora Technologies and Edda Wind
Can any of the company-specific risk be diversified away by investing in both Xplora Technologies and Edda Wind 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 Xplora Technologies and Edda Wind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xplora Technologies As and Edda Wind ASA, you can compare the effects of market volatilities on Xplora Technologies and Edda Wind 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 Xplora Technologies with a short position of Edda Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xplora Technologies and Edda Wind.
Diversification Opportunities for Xplora Technologies and Edda Wind
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xplora and Edda is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Xplora Technologies As and Edda Wind ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edda Wind ASA and Xplora Technologies 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 Xplora Technologies As are associated (or correlated) with Edda Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edda Wind ASA has no effect on the direction of Xplora Technologies i.e., Xplora Technologies and Edda Wind go up and down completely randomly.
Pair Corralation between Xplora Technologies and Edda Wind
Assuming the 90 days trading horizon Xplora Technologies As is expected to generate 1.03 times more return on investment than Edda Wind. However, Xplora Technologies is 1.03 times more volatile than Edda Wind ASA. It trades about -0.06 of its potential returns per unit of risk. Edda Wind ASA is currently generating about -0.07 per unit of risk. If you would invest 3,150 in Xplora Technologies As on December 30, 2024 and sell it today you would lose (300.00) from holding Xplora Technologies As or give up 9.52% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Xplora Technologies As vs. Edda Wind ASA
Performance |
Timeline |
Xplora Technologies |
Edda Wind ASA |
Xplora Technologies and Edda Wind Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xplora Technologies and Edda Wind
The main advantage of trading using opposite Xplora Technologies and Edda Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xplora Technologies position performs unexpectedly, Edda Wind 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 Edda Wind will offset losses from the drop in Edda Wind's long position.Xplora Technologies vs. Airthings ASA | Xplora Technologies vs. Pexip Holding ASA | Xplora Technologies vs. Huddlestock Fintech As |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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