Correlation Between Lagercrantz Group and Exsitec Holding
Can any of the company-specific risk be diversified away by investing in both Lagercrantz Group and Exsitec 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 Lagercrantz Group and Exsitec Holding 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 Exsitec Holding AB, you can compare the effects of market volatilities on Lagercrantz Group and Exsitec 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 Lagercrantz Group with a short position of Exsitec Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lagercrantz Group and Exsitec Holding.
Diversification Opportunities for Lagercrantz Group and Exsitec Holding
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lagercrantz and Exsitec is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Lagercrantz Group AB and Exsitec Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exsitec Holding 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 Exsitec Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exsitec Holding AB has no effect on the direction of Lagercrantz Group i.e., Lagercrantz Group and Exsitec Holding go up and down completely randomly.
Pair Corralation between Lagercrantz Group and Exsitec Holding
Assuming the 90 days trading horizon Lagercrantz Group AB is expected to under-perform the Exsitec Holding. But the stock apears to be less risky and, when comparing its historical volatility, Lagercrantz Group AB is 1.5 times less risky than Exsitec Holding. The stock trades about -0.25 of its potential returns per unit of risk. The Exsitec Holding AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 14,000 in Exsitec Holding AB on August 28, 2024 and sell it today you would earn a total of 150.00 from holding Exsitec Holding AB or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lagercrantz Group AB vs. Exsitec Holding AB
Performance |
| Timeline |
| Lagercrantz Group |
| Exsitec Holding AB |
Lagercrantz Group and Exsitec Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lagercrantz Group and Exsitec Holding
The main advantage of trading using opposite Lagercrantz Group and Exsitec Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lagercrantz Group position performs unexpectedly, Exsitec 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 Exsitec Holding will offset losses from the drop in Exsitec Holding's long position.| Lagercrantz Group vs. Addtech AB | Lagercrantz Group vs. Lifco AB | Lagercrantz Group vs. Indutrade AB | Lagercrantz Group vs. Vitec Software Group |
| Exsitec Holding vs. Svedbergs i Dalstorp | Exsitec Holding vs. Know IT AB | Exsitec Holding vs. FormPipe Software 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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