Correlation Between ChargePanel and CodeMill

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

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

Diversification Opportunities for ChargePanel and CodeMill

0.21

Correlation Coefficient

ChargePanel  CodeMill

Modest diversification

The 3 months correlation between ChargePanel and CodeMill is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding ChargePanel AB and CodeMill AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CodeMill AB and ChargePanel 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 ChargePanel AB are associated (or correlated) with CodeMill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CodeMill AB has no effect on the direction of ChargePanel i.e., ChargePanel and CodeMill go up and down completely randomly.

Pair Corralation between ChargePanel and CodeMill

Assuming the 90 days trading horizon ChargePanel AB is expected to generate 2.86 times more return on investment than CodeMill. However, ChargePanel is 2.86 times more volatile than CodeMill AB. It trades about 0.16 of its potential returns per unit of risk. CodeMill AB is currently generating about 0.16 per unit of risk. If you would invest  130.00  in ChargePanel AB on April 21, 2025 and sell it today you would earn a total of  70.00  from holding ChargePanel AB or generate 53.85% return on investment over 90 days.

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

ChargePanel AB  vs.  CodeMill AB

ChargePanel AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ChargePanel AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ChargePanel sustained solid returns over the last few months and may actually be approaching a breakup point.

CodeMill AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CodeMill AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CodeMill unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ChargePanel and CodeMill

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

The idea behind ChargePanel AB and CodeMill 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.