Correlation Between Eniro AB and Maven Wireless

Can any of the company-specific risk be diversified away by investing in both Eniro AB and Maven Wireless 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 Eniro AB and Maven Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eniro AB and Maven Wireless Sweden, you can compare the effects of market volatilities on Eniro AB and Maven Wireless 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 Eniro AB with a short position of Maven Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eniro AB and Maven Wireless.

Diversification Opportunities for Eniro AB and Maven Wireless

-0.53

Correlation Coefficient

Eniro AB  Maven Wireless

Excellent diversification

The 3 months correlation between Eniro and Maven is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Eniro AB and Maven Wireless Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maven Wireless Sweden and Eniro 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 Eniro AB are associated (or correlated) with Maven Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maven Wireless Sweden has no effect on the direction of Eniro AB i.e., Eniro AB and Maven Wireless go up and down completely randomly.

Pair Corralation between Eniro AB and Maven Wireless

Assuming the 90 days trading horizon Eniro AB is expected to generate 0.87 times more return on investment than Maven Wireless. However, Eniro AB is 1.15 times less risky than Maven Wireless. It trades about 0.05 of its potential returns per unit of risk. Maven Wireless Sweden is currently generating about -0.07 per unit of risk. If you would invest  44.00  in Eniro AB on September 5, 2024 and sell it today you would earn a total of  3.00  from holding Eniro AB or generate 6.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Eniro AB  vs.  Maven Wireless Sweden

Eniro AB

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eniro AB are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Eniro AB may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Maven Wireless Sweden

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Maven Wireless Sweden has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Eniro AB and Maven Wireless

The main advantage of trading using opposite Eniro AB and Maven Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eniro AB position performs unexpectedly, Maven Wireless 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 Maven Wireless will offset losses from the drop in Maven Wireless' long position.

The idea behind Eniro AB and Maven Wireless Sweden 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.

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 Anywhere module to track or share privately all of your investments from the convenience of any device.