Correlation Between Mentice AB and Promimic

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

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

Diversification Opportunities for Mentice AB and Promimic

0.63

Correlation Coefficient

Mentice AB  Promimic

Poor diversification

The 3 months correlation between Mentice and Promimic is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Mentice AB and Promimic AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promimic AB and Mentice 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 Mentice AB are associated (or correlated) with Promimic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promimic AB has no effect on the direction of Mentice AB i.e., Mentice AB and Promimic go up and down completely randomly.

Pair Corralation between Mentice AB and Promimic

Assuming the 90 days trading horizon Mentice AB is expected to under-perform the Promimic. But the stock apears to be less risky and, when comparing its historical volatility, Mentice AB is 1.46 times less risky than Promimic. The stock trades about -0.08 of its potential returns per unit of risk. The Promimic AB is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  2,400  in Promimic AB on April 21, 2025 and sell it today you would lose (550.00) from holding Promimic AB or give up 22.92% of portfolio value over 90 days.

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

Mentice AB  vs.  Promimic AB

Mentice AB

Risk-Adjusted Performance

Very Weak

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

Promimic AB

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Mentice AB and Promimic

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

The idea behind Mentice AB and Promimic 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.