Correlation Between Avanza Bank and OptiCept Technologies
Can any of the company-specific risk be diversified away by investing in both Avanza Bank and OptiCept Technologies 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 Avanza Bank and OptiCept Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avanza Bank Holding and OptiCept Technologies AB, you can compare the effects of market volatilities on Avanza Bank and OptiCept Technologies 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 Avanza Bank with a short position of OptiCept Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avanza Bank and OptiCept Technologies.
Diversification Opportunities for Avanza Bank and OptiCept Technologies
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Avanza and OptiCept is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Avanza Bank Holding and OptiCept Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiCept Technologies and Avanza Bank 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 Avanza Bank Holding are associated (or correlated) with OptiCept Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiCept Technologies has no effect on the direction of Avanza Bank i.e., Avanza Bank and OptiCept Technologies go up and down completely randomly.
Pair Corralation between Avanza Bank and OptiCept Technologies
Assuming the 90 days trading horizon Avanza Bank Holding is expected to generate 0.31 times more return on investment than OptiCept Technologies. However, Avanza Bank Holding is 3.28 times less risky than OptiCept Technologies. It trades about 0.03 of its potential returns per unit of risk. OptiCept Technologies AB is currently generating about 0.0 per unit of risk. If you would invest 23,281 in Avanza Bank Holding on October 23, 2024 and sell it today you would earn a total of 5,219 from holding Avanza Bank Holding or generate 22.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avanza Bank Holding vs. OptiCept Technologies AB
Performance |
| Timeline |
| Avanza Bank Holding |
| OptiCept Technologies |
Avanza Bank and OptiCept Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avanza Bank and OptiCept Technologies
The main advantage of trading using opposite Avanza Bank and OptiCept Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avanza Bank position performs unexpectedly, OptiCept Technologies 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 OptiCept Technologies will offset losses from the drop in OptiCept Technologies' long position.| Avanza Bank vs. Axfood AB | Avanza Bank vs. Samhllsbyggnadsbolaget i Norden | Avanza Bank vs. Castellum AB | Avanza Bank vs. Investor AB ser |
| OptiCept Technologies vs. Filo Mining Corp | OptiCept Technologies vs. Upsales Technology AB | OptiCept Technologies vs. Adventure Box Technology | OptiCept Technologies vs. Divio Technologies 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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