Correlation Between Investor and BHG Group
Can any of the company-specific risk be diversified away by investing in both Investor and BHG 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 Investor and BHG Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investor AB ser and BHG Group AB, you can compare the effects of market volatilities on Investor and BHG 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 Investor with a short position of BHG Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investor and BHG Group.
Diversification Opportunities for Investor and BHG Group
Very good diversification
The 3 months correlation between Investor and BHG is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Investor AB ser and BHG Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BHG Group AB and Investor 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 Investor AB ser are associated (or correlated) with BHG Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BHG Group AB has no effect on the direction of Investor i.e., Investor and BHG Group go up and down completely randomly.
Pair Corralation between Investor and BHG Group
Assuming the 90 days trading horizon Investor is expected to generate 226.0 times less return on investment than BHG Group. But when comparing it to its historical volatility, Investor AB ser is 4.53 times less risky than BHG Group. It trades about 0.0 of its potential returns per unit of risk. BHG Group AB is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,498 in BHG Group AB on September 13, 2024 and sell it today you would earn a total of 530.00 from holding BHG Group AB or generate 35.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Investor AB ser vs. BHG Group AB
Performance |
Timeline |
Investor AB ser |
BHG Group AB |
Investor and BHG Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Investor and BHG Group
The main advantage of trading using opposite Investor and BHG Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investor position performs unexpectedly, BHG 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 BHG Group will offset losses from the drop in BHG Group's long position.Investor vs. Kinnevik Investment AB | Investor vs. Investment AB Latour | Investor vs. Samhllsbyggnadsbolaget i Norden | Investor vs. Industrivarden AB ser |
BHG Group vs. Rugvista Group AB | BHG Group vs. Cint Group AB | BHG Group vs. Lyko Group A | BHG Group vs. Boozt 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |