Correlation Between Avensia Publ and Upsales Technology
Can any of the company-specific risk be diversified away by investing in both Avensia Publ and Upsales Technology 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 Avensia Publ and Upsales Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avensia publ AB and Upsales Technology AB, you can compare the effects of market volatilities on Avensia Publ and Upsales Technology 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 Avensia Publ with a short position of Upsales Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avensia Publ and Upsales Technology.
Diversification Opportunities for Avensia Publ and Upsales Technology
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Avensia and Upsales is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Avensia publ AB and Upsales Technology AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upsales Technology and Avensia Publ 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 Avensia publ AB are associated (or correlated) with Upsales Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upsales Technology has no effect on the direction of Avensia Publ i.e., Avensia Publ and Upsales Technology go up and down completely randomly.
Pair Corralation between Avensia Publ and Upsales Technology
Assuming the 90 days trading horizon Avensia publ AB is expected to generate 0.84 times more return on investment than Upsales Technology. However, Avensia publ AB is 1.19 times less risky than Upsales Technology. It trades about -0.02 of its potential returns per unit of risk. Upsales Technology AB is currently generating about -0.04 per unit of risk. If you would invest 1,300 in Avensia publ AB on August 28, 2024 and sell it today you would lose (510.00) from holding Avensia publ AB or give up 39.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avensia publ AB vs. Upsales Technology AB
Performance |
| Timeline |
| Avensia publ AB |
| Upsales Technology |
Avensia Publ and Upsales Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avensia Publ and Upsales Technology
The main advantage of trading using opposite Avensia Publ and Upsales Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avensia Publ position performs unexpectedly, Upsales Technology 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 Upsales Technology will offset losses from the drop in Upsales Technology's long position.| Avensia Publ vs. Svedbergs i Dalstorp | Avensia Publ vs. Know IT AB | Avensia Publ vs. FormPipe Software AB |
| Upsales Technology vs. Lime Technologies AB | Upsales Technology vs. FormPipe Software AB | Upsales Technology vs. Surgical Science Sweden | Upsales Technology vs. Vitec Software Group |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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