Correlation Between Image Systems and SECITS Holding
Can any of the company-specific risk be diversified away by investing in both Image Systems and SECITS Holding 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 Image Systems and SECITS Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Image Systems AB and SECITS Holding AB, you can compare the effects of market volatilities on Image Systems and SECITS Holding 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 Image Systems with a short position of SECITS Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Image Systems and SECITS Holding.
Diversification Opportunities for Image Systems and SECITS Holding
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Image and SECITS is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Image Systems AB and SECITS Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SECITS Holding AB and Image 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 Image Systems AB are associated (or correlated) with SECITS Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SECITS Holding AB has no effect on the direction of Image Systems i.e., Image Systems and SECITS Holding go up and down completely randomly.
Pair Corralation between Image Systems and SECITS Holding
Assuming the 90 days horizon Image Systems AB is expected to generate 0.34 times more return on investment than SECITS Holding. However, Image Systems AB is 2.98 times less risky than SECITS Holding. It trades about 0.1 of its potential returns per unit of risk. SECITS Holding AB is currently generating about -0.01 per unit of risk. If you would invest 95.00 in Image Systems AB on September 4, 2024 and sell it today you would earn a total of 105.00 from holding Image Systems AB or generate 110.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Image Systems AB vs. SECITS Holding AB
Performance |
| Timeline |
| Image Systems AB |
| SECITS Holding AB |
Image Systems and SECITS Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Image Systems and SECITS Holding
The main advantage of trading using opposite Image Systems and SECITS Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Image Systems position performs unexpectedly, SECITS Holding 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 SECITS Holding will offset losses from the drop in SECITS Holding's long position.| Image Systems vs. Anoto Group AB | Image Systems vs. Bong AB | Image Systems vs. Episurf Medical AB | Image Systems vs. Eniro AB |
| SECITS Holding vs. Enersize Oy | SECITS Holding vs. Zaplox AB | SECITS Holding vs. XMReality AB | SECITS Holding vs. Sonetel 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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