Correlation Between Invisio Communications and OptiCept Technologies
Can any of the company-specific risk be diversified away by investing in both Invisio Communications and OptiCept Technologies 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 OptiCept Technologies 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 OptiCept Technologies AB, you can compare the effects of market volatilities on Invisio Communications and OptiCept Technologies 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 OptiCept Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invisio Communications and OptiCept Technologies.
Diversification Opportunities for Invisio Communications and OptiCept Technologies
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Invisio and OptiCept is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Invisio Communications AB and OptiCept Technologies AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OptiCept Technologies 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 OptiCept Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OptiCept Technologies has no effect on the direction of Invisio Communications i.e., Invisio Communications and OptiCept Technologies go up and down completely randomly.
Pair Corralation between Invisio Communications and OptiCept Technologies
Assuming the 90 days trading horizon Invisio Communications AB is expected to generate 0.37 times more return on investment than OptiCept Technologies. However, Invisio Communications AB is 2.69 times less risky than OptiCept Technologies. It trades about 0.06 of its potential returns per unit of risk. OptiCept Technologies AB is currently generating about 0.0 per unit of risk. If you would invest 18,696 in Invisio Communications AB on October 30, 2024 and sell it today you would earn a total of 13,704 from holding Invisio Communications AB or generate 73.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invisio Communications AB vs. OptiCept Technologies AB
Performance |
| Timeline |
| Invisio Communications |
| OptiCept Technologies |
Invisio Communications and OptiCept Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invisio Communications and OptiCept Technologies
The main advantage of trading using opposite Invisio Communications and OptiCept Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invisio Communications position performs unexpectedly, OptiCept Technologies 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 OptiCept Technologies will offset losses from the drop in OptiCept Technologies' long position.| Invisio Communications vs. Hexatronic Group AB | Invisio Communications vs. CellaVision AB | Invisio Communications vs. Xvivo Perfusion AB | Invisio Communications vs. Sectra AB |
| OptiCept Technologies vs. Skandinaviska Enskilda Banken | OptiCept Technologies vs. New Nordic Healthbrands | OptiCept Technologies vs. Nordea Bank Abp | OptiCept Technologies vs. eEducation Albert 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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