Correlation Between Addnode Group and Serstech
Can any of the company-specific risk be diversified away by investing in both Addnode Group and Serstech 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 Addnode Group and Serstech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addnode Group AB and Serstech AB, you can compare the effects of market volatilities on Addnode Group and Serstech 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 Addnode Group with a short position of Serstech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addnode Group and Serstech.
Diversification Opportunities for Addnode Group and Serstech
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Addnode and Serstech is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Addnode Group AB and Serstech AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Serstech AB and Addnode Group 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 Addnode Group AB are associated (or correlated) with Serstech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Serstech AB has no effect on the direction of Addnode Group i.e., Addnode Group and Serstech go up and down completely randomly.
Pair Corralation between Addnode Group and Serstech
Assuming the 90 days trading horizon Addnode Group AB is expected to under-perform the Serstech. But the stock apears to be less risky and, when comparing its historical volatility, Addnode Group AB is 3.5 times less risky than Serstech. The stock trades about -0.38 of its potential returns per unit of risk. The Serstech AB is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 103.00 in Serstech AB on August 29, 2024 and sell it today you would earn a total of 11.00 from holding Serstech AB or generate 10.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Addnode Group AB vs. Serstech AB
Performance |
| Timeline |
| Addnode Group AB |
| Serstech AB |
Addnode Group and Serstech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addnode Group and Serstech
The main advantage of trading using opposite Addnode Group and Serstech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addnode Group position performs unexpectedly, Serstech 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 Serstech will offset losses from the drop in Serstech's long position.| Addnode Group vs. Softronic AB | Addnode Group vs. Prevas AB | Addnode Group vs. FormPipe Software AB | Addnode Group vs. Dedicare AB |
| Serstech vs. Enzymatica publ AB | Serstech vs. Polygiene AB | Serstech vs. Sprint Bioscience AB | Serstech vs. XMReality 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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