Correlation Between Systemair and Promotora
Can any of the company-specific risk be diversified away by investing in both Systemair and Promotora 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 Systemair and Promotora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Systemair AB and Promotora de Informaciones, you can compare the effects of market volatilities on Systemair and Promotora 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 Systemair with a short position of Promotora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Systemair and Promotora.
Diversification Opportunities for Systemair and Promotora
Very good diversification
The 3 months correlation between Systemair and Promotora is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Systemair AB and Promotora de Informaciones in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promotora de Informa and Systemair 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 Systemair AB are associated (or correlated) with Promotora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promotora de Informa has no effect on the direction of Systemair i.e., Systemair and Promotora go up and down completely randomly.
Pair Corralation between Systemair and Promotora
Assuming the 90 days trading horizon Systemair AB is expected to generate 1.54 times more return on investment than Promotora. However, Systemair is 1.54 times more volatile than Promotora de Informaciones. It trades about 0.29 of its potential returns per unit of risk. Promotora de Informaciones is currently generating about 0.01 per unit of risk. If you would invest 8,180 in Systemair AB on September 5, 2024 and sell it today you would earn a total of 1,080 from holding Systemair AB or generate 13.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Systemair AB vs. Promotora de Informaciones
Performance |
| Timeline |
| Systemair AB |
| Promotora de Informa |
Systemair and Promotora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Systemair and Promotora
The main advantage of trading using opposite Systemair and Promotora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Systemair position performs unexpectedly, Promotora 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 Promotora will offset losses from the drop in Promotora's long position.| Systemair vs. Samsung Electronics Co | Systemair vs. Samsung Electronics Co | Systemair vs. Hyundai Motor | Systemair vs. Toyota Motor Corp |
| Promotora vs. Samsung Electronics Co | Promotora vs. Samsung Electronics Co | Promotora vs. Hyundai Motor | Promotora vs. Toyota Motor Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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