Correlation Between Invisio Communications and SBB-B
Can any of the company-specific risk be diversified away by investing in both Invisio Communications and SBB-B 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 SBB-B 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 Samhllsbyggnadsbolaget i Norden, you can compare the effects of market volatilities on Invisio Communications and SBB-B 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 SBB-B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invisio Communications and SBB-B.
Diversification Opportunities for Invisio Communications and SBB-B
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Invisio and SBB-B is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Invisio Communications AB and Samhllsbyggnadsbolaget i Norde in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhllsbyggnadsbolaget 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 SBB-B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhllsbyggnadsbolaget has no effect on the direction of Invisio Communications i.e., Invisio Communications and SBB-B go up and down completely randomly.
Pair Corralation between Invisio Communications and SBB-B
Assuming the 90 days trading horizon Invisio Communications AB is expected to generate 0.38 times more return on investment than SBB-B. However, Invisio Communications AB is 2.63 times less risky than SBB-B. It trades about 0.06 of its potential returns per unit of risk. Samhllsbyggnadsbolaget i Norden is currently generating about -0.02 per unit of risk. If you would invest 16,594 in Invisio Communications AB on September 3, 2024 and sell it today you would earn a total of 11,606 from holding Invisio Communications AB or generate 69.94% 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. Samhllsbyggnadsbolaget i Norde
Performance |
| Timeline |
| Invisio Communications |
| Samhllsbyggnadsbolaget |
Invisio Communications and SBB-B Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invisio Communications and SBB-B
The main advantage of trading using opposite Invisio Communications and SBB-B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invisio Communications position performs unexpectedly, SBB-B 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 SBB-B will offset losses from the drop in SBB-B's long position.| Invisio Communications vs. Hexatronic Group AB | Invisio Communications vs. CellaVision AB | Invisio Communications vs. Xvivo Perfusion AB | Invisio Communications vs. Sectra 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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