Correlation Between Genovis AB and Systemair
Can any of the company-specific risk be diversified away by investing in both Genovis AB and Systemair 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 Genovis AB and Systemair into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genovis AB and Systemair AB, you can compare the effects of market volatilities on Genovis AB and Systemair 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 Genovis AB with a short position of Systemair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genovis AB and Systemair.
Diversification Opportunities for Genovis AB and Systemair
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Genovis and Systemair is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Genovis AB and Systemair AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Systemair AB and Genovis AB 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 Genovis AB are associated (or correlated) with Systemair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Systemair AB has no effect on the direction of Genovis AB i.e., Genovis AB and Systemair go up and down completely randomly.
Pair Corralation between Genovis AB and Systemair
Assuming the 90 days trading horizon Genovis AB is expected to generate 2.06 times less return on investment than Systemair. In addition to that, Genovis AB is 2.44 times more volatile than Systemair AB. It trades about 0.04 of its total potential returns per unit of risk. Systemair AB is currently generating about 0.18 per unit of volatility. If you would invest 7,535 in Systemair AB on August 28, 2024 and sell it today you would earn a total of 1,795 from holding Systemair AB or generate 23.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genovis AB vs. Systemair AB
Performance |
| Timeline |
| Genovis AB |
| Systemair AB |
Genovis AB and Systemair Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genovis AB and Systemair
The main advantage of trading using opposite Genovis AB and Systemair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genovis AB position performs unexpectedly, Systemair 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 Systemair will offset losses from the drop in Systemair's long position.| Genovis AB vs. Systemair AB | Genovis AB vs. Upsales Technology AB | Genovis AB vs. FormPipe Software AB | Genovis AB vs. White Pearl Technology |
| Systemair vs. Addtech AB | Systemair vs. Teqnion AB | Systemair vs. Vitec Software Group | Systemair vs. Lagercrantz 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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