Correlation Between Awardit AB and Sectra AB
Can any of the company-specific risk be diversified away by investing in both Awardit AB and Sectra AB 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 Awardit AB and Sectra AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Awardit AB and Sectra AB, you can compare the effects of market volatilities on Awardit AB and Sectra AB 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 Awardit AB with a short position of Sectra AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Awardit AB and Sectra AB.
Diversification Opportunities for Awardit AB and Sectra AB
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Awardit and Sectra is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Awardit AB and Sectra AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sectra AB and Awardit AB 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 Awardit AB are associated (or correlated) with Sectra AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sectra AB has no effect on the direction of Awardit AB i.e., Awardit AB and Sectra AB go up and down completely randomly.
Pair Corralation between Awardit AB and Sectra AB
Assuming the 90 days trading horizon Awardit AB is expected to under-perform the Sectra AB. But the stock apears to be less risky and, when comparing its historical volatility, Awardit AB is 1.26 times less risky than Sectra AB. The stock trades about -0.04 of its potential returns per unit of risk. The Sectra AB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 28,180 in Sectra AB on September 3, 2024 and sell it today you would earn a total of 290.00 from holding Sectra AB or generate 1.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Awardit AB vs. Sectra AB
Performance |
| Timeline |
| Awardit AB |
| Sectra AB |
Awardit AB and Sectra AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Awardit AB and Sectra AB
The main advantage of trading using opposite Awardit AB and Sectra AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Awardit AB position performs unexpectedly, Sectra AB 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 Sectra AB will offset losses from the drop in Sectra AB's long position.| Awardit AB vs. Catena Media plc | Awardit AB vs. Better Collective | Awardit AB vs. Betsson AB | Awardit AB vs. Kambi Group PLC |
| Sectra AB vs. Vitrolife AB | Sectra AB vs. Beijer Ref AB | Sectra AB vs. Biotage AB | Sectra AB vs. CellaVision 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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