Correlation Between Lagercrantz Group and Anoto Group
Can any of the company-specific risk be diversified away by investing in both Lagercrantz Group and Anoto Group 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 Lagercrantz Group and Anoto Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lagercrantz Group AB and Anoto Group AB, you can compare the effects of market volatilities on Lagercrantz Group and Anoto 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 Lagercrantz Group with a short position of Anoto Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lagercrantz Group and Anoto Group.
Diversification Opportunities for Lagercrantz Group and Anoto Group
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lagercrantz and Anoto is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Lagercrantz Group AB and Anoto Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anoto Group AB and Lagercrantz Group 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 Lagercrantz Group AB are associated (or correlated) with Anoto Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anoto Group AB has no effect on the direction of Lagercrantz Group i.e., Lagercrantz Group and Anoto Group go up and down completely randomly.
Pair Corralation between Lagercrantz Group and Anoto Group
Assuming the 90 days trading horizon Lagercrantz Group AB is expected to generate 0.28 times more return on investment than Anoto Group. However, Lagercrantz Group AB is 3.54 times less risky than Anoto Group. It trades about 0.07 of its potential returns per unit of risk. Anoto Group AB is currently generating about -0.14 per unit of risk. If you would invest 19,040 in Lagercrantz Group AB on October 14, 2024 and sell it today you would earn a total of 1,280 from holding Lagercrantz Group AB or generate 6.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lagercrantz Group AB vs. Anoto Group AB
Performance |
| Timeline |
| Lagercrantz Group |
| Anoto Group AB |
Lagercrantz Group and Anoto Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lagercrantz Group and Anoto Group
The main advantage of trading using opposite Lagercrantz Group and Anoto Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lagercrantz Group position performs unexpectedly, Anoto 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 Anoto Group will offset losses from the drop in Anoto Group's long position.| Lagercrantz Group vs. Addtech AB | Lagercrantz Group vs. Lifco AB | Lagercrantz Group vs. Indutrade AB | Lagercrantz Group vs. Vitec Software Group |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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