Correlation Between AstraZeneca PLC and Safello Group
Can any of the company-specific risk be diversified away by investing in both AstraZeneca PLC and Safello Group 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 AstraZeneca PLC and Safello Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AstraZeneca PLC and Safello Group AB, you can compare the effects of market volatilities on AstraZeneca PLC and Safello Group 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 AstraZeneca PLC with a short position of Safello Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstraZeneca PLC and Safello Group.
Diversification Opportunities for AstraZeneca PLC and Safello Group
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AstraZeneca and Safello is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding AstraZeneca PLC and Safello Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safello Group AB and AstraZeneca PLC 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 AstraZeneca PLC are associated (or correlated) with Safello Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safello Group AB has no effect on the direction of AstraZeneca PLC i.e., AstraZeneca PLC and Safello Group go up and down completely randomly.
Pair Corralation between AstraZeneca PLC and Safello Group
Assuming the 90 days trading horizon AstraZeneca PLC is expected to under-perform the Safello Group. But the stock apears to be less risky and, when comparing its historical volatility, AstraZeneca PLC is 3.23 times less risky than Safello Group. The stock trades about -0.06 of its potential returns per unit of risk. The Safello Group AB is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 510.00 in Safello Group AB on September 1, 2024 and sell it today you would earn a total of 92.00 from holding Safello Group AB or generate 18.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AstraZeneca PLC vs. Safello Group AB
Performance |
| Timeline |
| AstraZeneca PLC |
| Safello Group AB |
AstraZeneca PLC and Safello Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AstraZeneca PLC and Safello Group
The main advantage of trading using opposite AstraZeneca PLC and Safello Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstraZeneca PLC position performs unexpectedly, Safello Group 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 Safello Group will offset losses from the drop in Safello Group's long position.| AstraZeneca PLC vs. AB Volvo | AstraZeneca PLC vs. Telefonaktiebolaget LM Ericsson | AstraZeneca PLC vs. H M Hennes | AstraZeneca PLC vs. Investor AB ser |
| Safello Group vs. Goobit Group AB | Safello Group vs. CoinShares International | Safello Group vs. Zignsec AB | Safello Group vs. Checkin Group 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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