Correlation Between IAR Systems and IZafe Group
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By analyzing existing cross correlation between IAR Systems Group and iZafe Group AB, you can compare the effects of market volatilities on IAR Systems and IZafe 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 IAR Systems with a short position of IZafe Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of IAR Systems and IZafe Group.
Diversification Opportunities for IAR Systems and IZafe Group
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between IAR and IZafe is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding IAR Systems Group and iZafe Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iZafe Group AB and IAR 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 IAR Systems Group are associated (or correlated) with IZafe Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iZafe Group AB has no effect on the direction of IAR Systems i.e., IAR Systems and IZafe Group go up and down completely randomly.
Pair Corralation between IAR Systems and IZafe Group
Assuming the 90 days trading horizon IAR Systems Group is expected to generate 0.32 times more return on investment than IZafe Group. However, IAR Systems Group is 3.13 times less risky than IZafe Group. It trades about 0.08 of its potential returns per unit of risk. iZafe Group AB is currently generating about -0.05 per unit of risk. If you would invest 12,600 in IAR Systems Group on August 28, 2024 and sell it today you would earn a total of 350.00 from holding IAR Systems Group or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IAR Systems Group vs. iZafe Group AB
Performance |
| Timeline |
| IAR Systems Group |
| iZafe Group AB |
IAR Systems and IZafe Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IAR Systems and IZafe Group
The main advantage of trading using opposite IAR Systems and IZafe Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IAR Systems position performs unexpectedly, IZafe 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 IZafe Group will offset losses from the drop in IZafe Group's long position.| IAR Systems vs. CellaVision AB | IAR Systems vs. HMS Networks AB | IAR Systems vs. Enea AB | IAR Systems vs. Know IT AB |
| IZafe Group vs. Sprint Bioscience AB | IZafe Group vs. Acarix AS | IZafe Group vs. Annexin Pharmaceuticals 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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