Correlation Between Catena AB and COOR Service
Can any of the company-specific risk be diversified away by investing in both Catena AB and COOR Service 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 Catena AB and COOR Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catena AB and COOR Service Management, you can compare the effects of market volatilities on Catena AB and COOR Service 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 Catena AB with a short position of COOR Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catena AB and COOR Service.
Diversification Opportunities for Catena AB and COOR Service
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Catena and COOR is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Catena AB and COOR Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COOR Service Management and Catena 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 Catena AB are associated (or correlated) with COOR Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COOR Service Management has no effect on the direction of Catena AB i.e., Catena AB and COOR Service go up and down completely randomly.
Pair Corralation between Catena AB and COOR Service
Assuming the 90 days trading horizon Catena AB is expected to generate 0.82 times more return on investment than COOR Service. However, Catena AB is 1.22 times less risky than COOR Service. It trades about 0.02 of its potential returns per unit of risk. COOR Service Management is currently generating about -0.26 per unit of risk. If you would invest 48,700 in Catena AB on September 1, 2024 and sell it today you would earn a total of 200.00 from holding Catena AB or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Catena AB vs. COOR Service Management
Performance |
| Timeline |
| Catena AB |
| COOR Service Management |
Catena AB and COOR Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catena AB and COOR Service
The main advantage of trading using opposite Catena AB and COOR Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catena AB position performs unexpectedly, COOR Service 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 COOR Service will offset losses from the drop in COOR Service's long position.| Catena AB vs. Fastighets AB Balder | Catena AB vs. Fabege AB | Catena AB vs. Wihlborgs Fastigheter AB | Catena AB vs. AB Sagax |
| COOR Service vs. Samhllsbyggnadsbolaget i Norden | COOR Service vs. Sinch AB | COOR Service vs. Embracer Group AB | COOR Service vs. Evolution 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |