Correlation Between COOR Service and Invisio Communications
Can any of the company-specific risk be diversified away by investing in both COOR Service and Invisio Communications 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 COOR Service and Invisio Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COOR Service Management and Invisio Communications AB, you can compare the effects of market volatilities on COOR Service and Invisio Communications 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 COOR Service with a short position of Invisio Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of COOR Service and Invisio Communications.
Diversification Opportunities for COOR Service and Invisio Communications
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between COOR and Invisio is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding COOR Service Management and Invisio Communications AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invisio Communications and COOR Service 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 COOR Service Management are associated (or correlated) with Invisio Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invisio Communications has no effect on the direction of COOR Service i.e., COOR Service and Invisio Communications go up and down completely randomly.
Pair Corralation between COOR Service and Invisio Communications
Assuming the 90 days trading horizon COOR Service Management is expected to under-perform the Invisio Communications. But the stock apears to be less risky and, when comparing its historical volatility, COOR Service Management is 1.2 times less risky than Invisio Communications. The stock trades about -0.28 of its potential returns per unit of risk. The Invisio Communications AB is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 27,100 in Invisio Communications AB on August 29, 2024 and sell it today you would earn a total of 50.00 from holding Invisio Communications AB or generate 0.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COOR Service Management vs. Invisio Communications AB
Performance |
| Timeline |
| COOR Service Management |
| Invisio Communications |
COOR Service and Invisio Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COOR Service and Invisio Communications
The main advantage of trading using opposite COOR Service and Invisio Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COOR Service position performs unexpectedly, Invisio Communications 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 Invisio Communications will offset losses from the drop in Invisio Communications' long position.| COOR Service vs. Inwido AB | COOR Service vs. Cloetta AB | COOR Service vs. Clas Ohlson AB | COOR Service vs. Bufab Holding AB |
| Invisio Communications vs. Hexatronic Group AB | Invisio Communications vs. CellaVision AB | Invisio Communications vs. Xvivo Perfusion AB | Invisio Communications vs. Sectra 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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