Correlation Between Cessatech and Kreditbanken

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Cessatech and Kreditbanken 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 Cessatech and Kreditbanken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cessatech AS and Kreditbanken AS, you can compare the effects of market volatilities on Cessatech and Kreditbanken 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 Cessatech with a short position of Kreditbanken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cessatech and Kreditbanken.

Diversification Opportunities for Cessatech and Kreditbanken

-0.1
  Correlation Coefficient

Good diversification

The 3 months correlation between Cessatech and Kreditbanken is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Cessatech AS and Kreditbanken AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kreditbanken AS and Cessatech 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 Cessatech AS are associated (or correlated) with Kreditbanken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kreditbanken AS has no effect on the direction of Cessatech i.e., Cessatech and Kreditbanken go up and down completely randomly.

Pair Corralation between Cessatech and Kreditbanken

Assuming the 90 days trading horizon Cessatech AS is expected to under-perform the Kreditbanken. In addition to that, Cessatech is 3.28 times more volatile than Kreditbanken AS. It trades about -0.12 of its total potential returns per unit of risk. Kreditbanken AS is currently generating about 0.04 per unit of volatility. If you would invest  450,000  in Kreditbanken AS on September 12, 2024 and sell it today you would earn a total of  55,000  from holding Kreditbanken AS or generate 12.22% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy11.34%
ValuesDaily Returns

Cessatech AS  vs.  Kreditbanken AS

 Performance 
       Timeline  
Cessatech AS 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Cessatech AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
Kreditbanken AS 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Kreditbanken AS are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Kreditbanken is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Cessatech and Kreditbanken Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cessatech and Kreditbanken

The main advantage of trading using opposite Cessatech and Kreditbanken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cessatech position performs unexpectedly, Kreditbanken 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 Kreditbanken will offset losses from the drop in Kreditbanken's long position.
The idea behind Cessatech AS and Kreditbanken AS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

Other Complementary Tools

Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios