Correlation Between Beowulf Mining and Embellence Group

Can any of the company-specific risk be diversified away by investing in both Beowulf Mining and Embellence 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 Beowulf Mining and Embellence Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Beowulf Mining PLC and Embellence Group AB, you can compare the effects of market volatilities on Beowulf Mining and Embellence 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 Beowulf Mining with a short position of Embellence Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beowulf Mining and Embellence Group.

Diversification Opportunities for Beowulf Mining and Embellence Group

-0.44

Correlation Coefficient

Beowulf Mining  Embellence Group

Very good diversification

The 3 months correlation between Beowulf and Embellence is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Beowulf Mining PLC and Embellence Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Embellence Group and Beowulf Mining 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 Beowulf Mining PLC are associated (or correlated) with Embellence Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Embellence Group has no effect on the direction of Beowulf Mining i.e., Beowulf Mining and Embellence Group go up and down completely randomly.

Pair Corralation between Beowulf Mining and Embellence Group

Assuming the 90 days trading horizon Beowulf Mining PLC is expected to under-perform the Embellence Group. In addition to that, Beowulf Mining is 1.92 times more volatile than Embellence Group AB. It trades about -0.01 of its total potential returns per unit of risk. Embellence Group AB is currently generating about 0.11 per unit of volatility. If you would invest  3,368  in Embellence Group AB on April 25, 2025 and sell it today you would earn a total of  382.00  from holding Embellence Group AB or generate 11.34% return on investment over 90 days.

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

Beowulf Mining PLC  vs.  Embellence Group AB

Beowulf Mining PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Beowulf Mining PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Beowulf Mining is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Embellence Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Embellence Group AB are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental drivers, Embellence Group may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Beowulf Mining and Embellence Group

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

The idea behind Beowulf Mining PLC and Embellence Group 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.

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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.