Correlation Between Aino Health and Gapwaves
Can any of the company-specific risk be diversified away by investing in both Aino Health and Gapwaves 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 Aino Health and Gapwaves into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aino Health AB and Gapwaves AB Series, you can compare the effects of market volatilities on Aino Health and Gapwaves 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 Aino Health with a short position of Gapwaves. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aino Health and Gapwaves.
Diversification Opportunities for Aino Health and Gapwaves
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aino and Gapwaves is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Aino Health AB and Gapwaves AB Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gapwaves AB Series and Aino Health 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 Aino Health AB are associated (or correlated) with Gapwaves. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gapwaves AB Series has no effect on the direction of Aino Health i.e., Aino Health and Gapwaves go up and down completely randomly.
Pair Corralation between Aino Health and Gapwaves
Assuming the 90 days trading horizon Aino Health AB is expected to generate 4.89 times more return on investment than Gapwaves. However, Aino Health is 4.89 times more volatile than Gapwaves AB Series. It trades about 0.01 of its potential returns per unit of risk. Gapwaves AB Series is currently generating about -0.04 per unit of risk. If you would invest 159.00 in Aino Health AB on August 24, 2024 and sell it today you would lose (145.00) from holding Aino Health AB or give up 91.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aino Health AB vs. Gapwaves AB Series
Performance |
| Timeline |
| Aino Health AB |
| Gapwaves AB Series |
Aino Health and Gapwaves Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aino Health and Gapwaves
The main advantage of trading using opposite Aino Health and Gapwaves positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aino Health position performs unexpectedly, Gapwaves 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 Gapwaves will offset losses from the drop in Gapwaves' long position.| Aino Health vs. Softronic AB | Aino Health vs. Novotek AB | Aino Health vs. Svedbergs i Dalstorp | Aino Health vs. Know IT AB |
| Gapwaves vs. Sivers IMA Holding | Gapwaves vs. SaltX Technology Holding | Gapwaves vs. Acconeer AB | Gapwaves vs. Fingerprint Cards 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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