Correlation Between SYSTEMAIR and Power Assets
Can any of the company-specific risk be diversified away by investing in both SYSTEMAIR and Power Assets 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 Power Assets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SYSTEMAIR AB and Power Assets Holdings, you can compare the effects of market volatilities on SYSTEMAIR and Power Assets 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 Power Assets. Check out your portfolio center. Please also check ongoing floating volatility patterns of SYSTEMAIR and Power Assets.
Diversification Opportunities for SYSTEMAIR and Power Assets
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between SYSTEMAIR and Power is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding SYSTEMAIR AB and Power Assets Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Assets Holdings 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 Power Assets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Assets Holdings has no effect on the direction of SYSTEMAIR i.e., SYSTEMAIR and Power Assets go up and down completely randomly.
Pair Corralation between SYSTEMAIR and Power Assets
Assuming the 90 days trading horizon SYSTEMAIR AB is expected to under-perform the Power Assets. In addition to that, SYSTEMAIR is 2.51 times more volatile than Power Assets Holdings. It trades about -0.07 of its total potential returns per unit of risk. Power Assets Holdings is currently generating about 0.02 per unit of volatility. If you would invest 615.00 in Power Assets Holdings on October 30, 2024 and sell it today you would earn a total of 5.00 from holding Power Assets Holdings or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SYSTEMAIR AB vs. Power Assets Holdings
Performance |
| Timeline |
| SYSTEMAIR AB |
| Power Assets Holdings |
SYSTEMAIR and Power Assets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SYSTEMAIR and Power Assets
The main advantage of trading using opposite SYSTEMAIR and Power Assets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SYSTEMAIR position performs unexpectedly, Power Assets 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 Power Assets will offset losses from the drop in Power Assets' long position.| SYSTEMAIR vs. CN MODERN DAIRY | SYSTEMAIR vs. Axfood AB | SYSTEMAIR vs. Goodyear Tire Rubber | SYSTEMAIR vs. Lery Seafood Group |
| Power Assets vs. ZINC MEDIA GR | Power Assets vs. SBM OFFSHORE | Power Assets vs. CHINA SOUTHN AIR H | Power Assets vs. GigaMedia |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |