Correlation Between Duni AB and Candles Scandinavia
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By analyzing existing cross correlation between Duni AB and Candles Scandinavia AB, you can compare the effects of market volatilities on Duni AB and Candles Scandinavia 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 Duni AB with a short position of Candles Scandinavia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duni AB and Candles Scandinavia.
Diversification Opportunities for Duni AB and Candles Scandinavia
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Duni and Candles is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Duni AB and Candles Scandinavia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candles Scandinavia and Duni AB 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 Duni AB are associated (or correlated) with Candles Scandinavia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Candles Scandinavia has no effect on the direction of Duni AB i.e., Duni AB and Candles Scandinavia go up and down completely randomly.
Pair Corralation between Duni AB and Candles Scandinavia
Assuming the 90 days trading horizon Duni AB is expected to under-perform the Candles Scandinavia. But the stock apears to be less risky and, when comparing its historical volatility, Duni AB is 2.42 times less risky than Candles Scandinavia. The stock trades about -0.08 of its potential returns per unit of risk. The Candles Scandinavia AB is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,915 in Candles Scandinavia AB on September 11, 2024 and sell it today you would earn a total of 295.00 from holding Candles Scandinavia AB or generate 15.4% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Duni AB vs. Candles Scandinavia AB
Performance |
Timeline |
Duni AB |
Candles Scandinavia |
Duni AB and Candles Scandinavia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Duni AB and Candles Scandinavia
The main advantage of trading using opposite Duni AB and Candles Scandinavia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duni AB position performs unexpectedly, Candles Scandinavia 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 Candles Scandinavia will offset losses from the drop in Candles Scandinavia's long position.The idea behind Duni AB and Candles Scandinavia 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.Candles Scandinavia vs. Lyko Group A | Candles Scandinavia vs. Duroc AB | Candles Scandinavia vs. Byggmax Group AB | Candles Scandinavia vs. Nimbus Group 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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