Correlation Between Learning Technologies and Systemair
Can any of the company-specific risk be diversified away by investing in both Learning Technologies and Systemair 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 Learning Technologies and Systemair into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Learning Technologies Group and Systemair AB, you can compare the effects of market volatilities on Learning Technologies and Systemair 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 Learning Technologies with a short position of Systemair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Learning Technologies and Systemair.
Diversification Opportunities for Learning Technologies and Systemair
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Learning and Systemair is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Learning Technologies Group and Systemair AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Systemair AB and Learning Technologies 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 Learning Technologies Group are associated (or correlated) with Systemair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Systemair AB has no effect on the direction of Learning Technologies i.e., Learning Technologies and Systemair go up and down completely randomly.
Pair Corralation between Learning Technologies and Systemair
Assuming the 90 days trading horizon Learning Technologies Group is expected to under-perform the Systemair. But the stock apears to be less risky and, when comparing its historical volatility, Learning Technologies Group is 2.16 times less risky than Systemair. The stock trades about -0.34 of its potential returns per unit of risk. The Systemair AB is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 8,820 in Systemair AB on October 30, 2024 and sell it today you would lose (290.00) from holding Systemair AB or give up 3.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Learning Technologies Group vs. Systemair AB
Performance |
| Timeline |
| Learning Technologies |
| Systemair AB |
Learning Technologies and Systemair Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Learning Technologies and Systemair
The main advantage of trading using opposite Learning Technologies and Systemair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Learning Technologies position performs unexpectedly, Systemair 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 Systemair will offset losses from the drop in Systemair's long position.| Learning Technologies vs. United Internet AG | Learning Technologies vs. Symphony Environmental Technologies | Learning Technologies vs. Cairo Communication SpA | Learning Technologies vs. Gear4music Plc |
| Systemair vs. Bisichi Mining PLC | Systemair vs. Air Products Chemicals | Systemair vs. Coeur Mining | Systemair vs. Fulcrum Metals PLC |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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