Correlation Between Axactor SE and Arcticzymes Technologies
Can any of the company-specific risk be diversified away by investing in both Axactor SE and Arcticzymes Technologies 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 Axactor SE and Arcticzymes Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axactor SE and Arcticzymes Technologies ASA, you can compare the effects of market volatilities on Axactor SE and Arcticzymes Technologies 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 Axactor SE with a short position of Arcticzymes Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axactor SE and Arcticzymes Technologies.
Diversification Opportunities for Axactor SE and Arcticzymes Technologies
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Axactor and Arcticzymes is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Axactor SE and Arcticzymes Technologies ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcticzymes Technologies and Axactor SE 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 Axactor SE are associated (or correlated) with Arcticzymes Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcticzymes Technologies has no effect on the direction of Axactor SE i.e., Axactor SE and Arcticzymes Technologies go up and down completely randomly.
Pair Corralation between Axactor SE and Arcticzymes Technologies
Assuming the 90 days trading horizon Axactor SE is expected to generate 1.56 times less return on investment than Arcticzymes Technologies. But when comparing it to its historical volatility, Axactor SE is 2.22 times less risky than Arcticzymes Technologies. It trades about 0.31 of its potential returns per unit of risk. Arcticzymes Technologies ASA is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,418 in Arcticzymes Technologies ASA on November 29, 2024 and sell it today you would earn a total of 404.00 from holding Arcticzymes Technologies ASA or generate 28.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axactor SE vs. Arcticzymes Technologies ASA
Performance |
| Timeline |
| Axactor SE |
| Arcticzymes Technologies |
Axactor SE and Arcticzymes Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axactor SE and Arcticzymes Technologies
The main advantage of trading using opposite Axactor SE and Arcticzymes Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axactor SE position performs unexpectedly, Arcticzymes Technologies 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 Arcticzymes Technologies will offset losses from the drop in Arcticzymes Technologies' long position.| Axactor SE vs. Storebrand ASA | Axactor SE vs. Aker BP ASA | Axactor SE vs. MPC Container Ships | Axactor SE vs. Norske Skog Asa |
| Arcticzymes Technologies vs. Bergenbio ASA | Arcticzymes Technologies vs. Photocure | Arcticzymes Technologies vs. Kitron ASA | Arcticzymes Technologies vs. Vow ASA |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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