Correlation Between AVTECH Sweden and K2A Knaust
Can any of the company-specific risk be diversified away by investing in both AVTECH Sweden and K2A Knaust 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 AVTECH Sweden and K2A Knaust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVTECH Sweden AB and K2A Knaust Andersson, you can compare the effects of market volatilities on AVTECH Sweden and K2A Knaust 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 AVTECH Sweden with a short position of K2A Knaust. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVTECH Sweden and K2A Knaust.
Diversification Opportunities for AVTECH Sweden and K2A Knaust
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AVTECH and K2A is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding AVTECH Sweden AB and K2A Knaust Andersson in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K2A Knaust Andersson and AVTECH Sweden 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 AVTECH Sweden AB are associated (or correlated) with K2A Knaust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K2A Knaust Andersson has no effect on the direction of AVTECH Sweden i.e., AVTECH Sweden and K2A Knaust go up and down completely randomly.
Pair Corralation between AVTECH Sweden and K2A Knaust
Assuming the 90 days trading horizon AVTECH Sweden AB is expected to generate 1.3 times more return on investment than K2A Knaust. However, AVTECH Sweden is 1.3 times more volatile than K2A Knaust Andersson. It trades about -0.15 of its potential returns per unit of risk. K2A Knaust Andersson is currently generating about -0.34 per unit of risk. If you would invest 448.00 in AVTECH Sweden AB on September 2, 2024 and sell it today you would lose (53.00) from holding AVTECH Sweden AB or give up 11.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AVTECH Sweden AB vs. K2A Knaust Andersson
Performance |
| Timeline |
| AVTECH Sweden AB |
| K2A Knaust Andersson |
AVTECH Sweden and K2A Knaust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVTECH Sweden and K2A Knaust
The main advantage of trading using opposite AVTECH Sweden and K2A Knaust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVTECH Sweden position performs unexpectedly, K2A Knaust 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 K2A Knaust will offset losses from the drop in K2A Knaust's long position.| AVTECH Sweden vs. AroCell AB | AVTECH Sweden vs. aXichem AB | AVTECH Sweden vs. Gaming Corps AB | AVTECH Sweden vs. Alelion Energy Systems |
| K2A Knaust vs. K Fast Holding AB | K2A Knaust vs. Nyfosa AB | K2A Knaust vs. Fastighets AB Balder | K2A Knaust vs. Catena 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |