Correlation Between ChargePanel and Opter AB
Can any of the company-specific risk be diversified away by investing in both ChargePanel and Opter 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 ChargePanel and Opter AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChargePanel AB and Opter AB, you can compare the effects of market volatilities on ChargePanel and Opter 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 ChargePanel with a short position of Opter AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChargePanel and Opter AB.
Diversification Opportunities for ChargePanel and Opter AB
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ChargePanel and Opter is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding ChargePanel AB and Opter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opter AB and ChargePanel 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 ChargePanel AB are associated (or correlated) with Opter AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Opter AB has no effect on the direction of ChargePanel i.e., ChargePanel and Opter AB go up and down completely randomly.
Pair Corralation between ChargePanel and Opter AB
Assuming the 90 days trading horizon ChargePanel AB is expected to under-perform the Opter AB. In addition to that, ChargePanel is 1.79 times more volatile than Opter AB. It trades about -0.03 of its total potential returns per unit of risk. Opter AB is currently generating about 0.09 per unit of volatility. If you would invest 4,930 in Opter AB on August 28, 2024 and sell it today you would earn a total of 7,120 from holding Opter AB or generate 144.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChargePanel AB vs. Opter AB
Performance |
| Timeline |
| ChargePanel AB |
| Opter AB |
ChargePanel and Opter AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChargePanel and Opter AB
The main advantage of trading using opposite ChargePanel and Opter AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChargePanel position performs unexpectedly, Opter 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 Opter AB will offset losses from the drop in Opter AB's long position.| ChargePanel vs. Sinch AB | ChargePanel vs. Hexatronic Group AB | ChargePanel vs. Samhllsbyggnadsbolaget i Norden | ChargePanel vs. Storskogen Group AB |
| Opter AB vs. Sinch AB | Opter AB vs. Hexatronic Group AB | Opter AB vs. Samhllsbyggnadsbolaget i Norden | Opter AB vs. Storskogen 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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