Correlation Between Invisio Communications and COOR Service
Can any of the company-specific risk be diversified away by investing in both Invisio Communications and COOR Service 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 Invisio Communications and COOR Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invisio Communications AB and COOR Service Management, you can compare the effects of market volatilities on Invisio Communications and COOR Service 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 Invisio Communications with a short position of COOR Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invisio Communications and COOR Service.
Diversification Opportunities for Invisio Communications and COOR Service
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Invisio and COOR is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Invisio Communications AB and COOR Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COOR Service Management and Invisio Communications 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 Invisio Communications AB are associated (or correlated) with COOR Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COOR Service Management has no effect on the direction of Invisio Communications i.e., Invisio Communications and COOR Service go up and down completely randomly.
Pair Corralation between Invisio Communications and COOR Service
Assuming the 90 days trading horizon Invisio Communications AB is expected to generate 1.08 times more return on investment than COOR Service. However, Invisio Communications is 1.08 times more volatile than COOR Service Management. It trades about 0.05 of its potential returns per unit of risk. COOR Service Management is currently generating about -0.04 per unit of risk. If you would invest 17,149 in Invisio Communications AB on August 25, 2024 and sell it today you would earn a total of 10,451 from holding Invisio Communications AB or generate 60.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invisio Communications AB vs. COOR Service Management
Performance |
| Timeline |
| Invisio Communications |
| COOR Service Management |
Invisio Communications and COOR Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invisio Communications and COOR Service
The main advantage of trading using opposite Invisio Communications and COOR Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invisio Communications position performs unexpectedly, COOR Service 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 COOR Service will offset losses from the drop in COOR Service's long position.| Invisio Communications vs. Addtech AB | Invisio Communications vs. Teqnion AB | Invisio Communications vs. Vitec Software Group | Invisio Communications vs. Lagercrantz Group AB |
| COOR Service vs. Inwido AB | COOR Service vs. Cloetta AB | COOR Service vs. Clas Ohlson AB | COOR Service vs. Bufab Holding 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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