Correlation Between Creotech Instruments and Action SA
Can any of the company-specific risk be diversified away by investing in both Creotech Instruments and Action SA 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 Creotech Instruments and Action SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Creotech Instruments SA and Action SA, you can compare the effects of market volatilities on Creotech Instruments and Action SA 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 Creotech Instruments with a short position of Action SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creotech Instruments and Action SA.
Diversification Opportunities for Creotech Instruments and Action SA
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Creotech and Action is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Creotech Instruments SA and Action SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Action SA and Creotech Instruments 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 Creotech Instruments SA are associated (or correlated) with Action SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Action SA has no effect on the direction of Creotech Instruments i.e., Creotech Instruments and Action SA go up and down completely randomly.
Pair Corralation between Creotech Instruments and Action SA
Assuming the 90 days trading horizon Creotech Instruments SA is expected to under-perform the Action SA. In addition to that, Creotech Instruments is 1.89 times more volatile than Action SA. It trades about -0.01 of its total potential returns per unit of risk. Action SA is currently generating about 0.0 per unit of volatility. If you would invest 1,922 in Action SA on September 12, 2024 and sell it today you would lose (50.00) from holding Action SA or give up 2.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Creotech Instruments SA vs. Action SA
Performance |
| Timeline |
| Creotech Instruments |
| Action SA |
Creotech Instruments and Action SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creotech Instruments and Action SA
The main advantage of trading using opposite Creotech Instruments and Action SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creotech Instruments position performs unexpectedly, Action SA 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 Action SA will offset losses from the drop in Action SA's long position.| Creotech Instruments vs. Action SA | Creotech Instruments vs. Asseco Business Solutions | Creotech Instruments vs. Detalion Games SA | Creotech Instruments vs. Asseco South Eastern |
| Action SA vs. Saule Technologies SA | Action SA vs. PZ Cormay SA | Action SA vs. LSI Software SA | Action SA vs. Centrum Finansowe Banku |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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