Correlation Between Lagercrantz Group and Sedana Medical
Can any of the company-specific risk be diversified away by investing in both Lagercrantz Group and Sedana Medical 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 Sedana Medical 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 Sedana Medical AB, you can compare the effects of market volatilities on Lagercrantz Group and Sedana Medical 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 Sedana Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lagercrantz Group and Sedana Medical.
Diversification Opportunities for Lagercrantz Group and Sedana Medical
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lagercrantz and Sedana is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Lagercrantz Group AB and Sedana Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sedana Medical 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 Sedana Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sedana Medical AB has no effect on the direction of Lagercrantz Group i.e., Lagercrantz Group and Sedana Medical go up and down completely randomly.
Pair Corralation between Lagercrantz Group and Sedana Medical
Assuming the 90 days trading horizon Lagercrantz Group AB is expected to generate 0.27 times more return on investment than Sedana Medical. However, Lagercrantz Group AB is 3.74 times less risky than Sedana Medical. It trades about -0.27 of its potential returns per unit of risk. Sedana Medical AB is currently generating about -0.15 per unit of risk. If you would invest 21,120 in Lagercrantz Group AB on August 27, 2024 and sell it today you would lose (1,610) from holding Lagercrantz Group AB or give up 7.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lagercrantz Group AB vs. Sedana Medical AB
Performance |
| Timeline |
| Lagercrantz Group |
| Sedana Medical AB |
Lagercrantz Group and Sedana Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lagercrantz Group and Sedana Medical
The main advantage of trading using opposite Lagercrantz Group and Sedana Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lagercrantz Group position performs unexpectedly, Sedana Medical 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 Sedana Medical will offset losses from the drop in Sedana Medical's long position.| Lagercrantz Group vs. Addtech AB | Lagercrantz Group vs. Lifco AB | Lagercrantz Group vs. Indutrade AB | Lagercrantz Group vs. Vitec Software Group |
| Sedana Medical vs. Addtech AB | Sedana Medical vs. Lifco AB | Sedana Medical vs. Indutrade AB | Sedana Medical vs. Lagercrantz Group 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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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