Correlation Between CTT Systems and Lagercrantz Group
Can any of the company-specific risk be diversified away by investing in both CTT Systems and Lagercrantz Group 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 CTT Systems and Lagercrantz Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CTT Systems AB and Lagercrantz Group AB, you can compare the effects of market volatilities on CTT Systems and Lagercrantz Group 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 CTT Systems with a short position of Lagercrantz Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CTT Systems and Lagercrantz Group.
Diversification Opportunities for CTT Systems and Lagercrantz Group
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CTT and Lagercrantz is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding CTT Systems AB and Lagercrantz Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lagercrantz Group and CTT Systems 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 CTT Systems AB are associated (or correlated) with Lagercrantz Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lagercrantz Group has no effect on the direction of CTT Systems i.e., CTT Systems and Lagercrantz Group go up and down completely randomly.
Pair Corralation between CTT Systems and Lagercrantz Group
Assuming the 90 days trading horizon CTT Systems is expected to generate 1.04 times less return on investment than Lagercrantz Group. In addition to that, CTT Systems is 1.47 times more volatile than Lagercrantz Group AB. It trades about 0.2 of its total potential returns per unit of risk. Lagercrantz Group AB is currently generating about 0.3 per unit of volatility. If you would invest 19,510 in Lagercrantz Group AB on September 25, 2024 and sell it today you would earn a total of 1,710 from holding Lagercrantz Group AB or generate 8.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
CTT Systems AB vs. Lagercrantz Group AB
Performance |
| Timeline |
| CTT Systems AB |
| Lagercrantz Group |
CTT Systems and Lagercrantz Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CTT Systems and Lagercrantz Group
The main advantage of trading using opposite CTT Systems and Lagercrantz Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CTT Systems position performs unexpectedly, Lagercrantz Group 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 Lagercrantz Group will offset losses from the drop in Lagercrantz Group's long position.| CTT Systems vs. Enea AB | CTT Systems vs. BTS Group AB | CTT Systems vs. CellaVision AB | CTT Systems vs. Biotage AB |
| Lagercrantz Group vs. FormPipe Software AB | Lagercrantz Group vs. Micro Systemation AB | Lagercrantz Group vs. CTT Systems AB | Lagercrantz Group vs. CAG 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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