Correlation Between OMX Stockholm and Lidds AB
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By analyzing existing cross correlation between OMX Stockholm Mid and Lidds AB, you can compare the effects of market volatilities on OMX Stockholm and Lidds AB 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 OMX Stockholm with a short position of Lidds AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Stockholm and Lidds AB.
Diversification Opportunities for OMX Stockholm and Lidds AB
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between OMX and Lidds is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding OMX Stockholm Mid and Lidds AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lidds AB and OMX Stockholm 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 OMX Stockholm Mid are associated (or correlated) with Lidds AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lidds AB has no effect on the direction of OMX Stockholm i.e., OMX Stockholm and Lidds AB go up and down completely randomly.
Pair Corralation between OMX Stockholm and Lidds AB
Assuming the 90 days trading horizon OMX Stockholm is expected to generate 2.68 times less return on investment than Lidds AB. But when comparing it to its historical volatility, OMX Stockholm Mid is 8.32 times less risky than Lidds AB. It trades about 0.24 of its potential returns per unit of risk. Lidds AB is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Lidds AB on February 5, 2024 and sell it today you would earn a total of 2.00 from holding Lidds AB or generate 13.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
OMX Stockholm Mid vs. Lidds AB
Performance |
Timeline |
OMX Stockholm and Lidds AB Volatility Contrast
Predicted Return Density |
Returns |
OMX Stockholm Mid
Pair trading matchups for OMX Stockholm
Lidds AB
Pair trading matchups for Lidds AB
Pair Trading with OMX Stockholm and Lidds AB
The main advantage of trading using opposite OMX Stockholm and Lidds AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Stockholm position performs unexpectedly, Lidds AB 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 Lidds AB will offset losses from the drop in Lidds AB's long position.OMX Stockholm vs. OMX Stockholm Large | OMX Stockholm vs. OMX Stockholm | OMX Stockholm vs. OMX Stockholm GI | OMX Stockholm vs. OMX Stockholm 30 |
Lidds AB vs. Alligator Bioscience AB | Lidds AB vs. Swedish Orphan Biovitrum | Lidds AB vs. Anoto Group 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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