Correlation Between Fenix Outdoor and SkiStar AB
Can any of the company-specific risk be diversified away by investing in both Fenix Outdoor and SkiStar 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 Fenix Outdoor and SkiStar AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fenix Outdoor International and SkiStar AB, you can compare the effects of market volatilities on Fenix Outdoor and SkiStar 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 Fenix Outdoor with a short position of SkiStar AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fenix Outdoor and SkiStar AB.
Diversification Opportunities for Fenix Outdoor and SkiStar AB
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fenix and SkiStar is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Fenix Outdoor International and SkiStar AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SkiStar AB and Fenix Outdoor 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 Fenix Outdoor International are associated (or correlated) with SkiStar AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SkiStar AB has no effect on the direction of Fenix Outdoor i.e., Fenix Outdoor and SkiStar AB go up and down completely randomly.
Pair Corralation between Fenix Outdoor and SkiStar AB
Assuming the 90 days trading horizon Fenix Outdoor is expected to generate 1.06 times less return on investment than SkiStar AB. In addition to that, Fenix Outdoor is 1.24 times more volatile than SkiStar AB. It trades about 0.09 of its total potential returns per unit of risk. SkiStar AB is currently generating about 0.11 per unit of volatility. If you would invest 15,670 in SkiStar AB on September 12, 2024 and sell it today you would earn a total of 1,470 from holding SkiStar AB or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fenix Outdoor International vs. SkiStar AB
Performance |
| Timeline |
| Fenix Outdoor Intern |
| SkiStar AB |
Fenix Outdoor and SkiStar AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fenix Outdoor and SkiStar AB
The main advantage of trading using opposite Fenix Outdoor and SkiStar AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fenix Outdoor position performs unexpectedly, SkiStar 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 SkiStar AB will offset losses from the drop in SkiStar AB's long position.| Fenix Outdoor vs. Thule Group AB | Fenix Outdoor vs. Nolato AB | Fenix Outdoor vs. Holmen AB | Fenix Outdoor vs. Troax Group AB |
| SkiStar AB vs. Peab AB | SkiStar AB vs. Axfood AB | SkiStar AB vs. Thule Group AB | SkiStar AB vs. Avanza Bank Holding |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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