Correlation Between OptiCept Technologies and Kinnevik Investment
Can any of the company-specific risk be diversified away by investing in both OptiCept Technologies and Kinnevik Investment 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 OptiCept Technologies and Kinnevik Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OptiCept Technologies AB and Kinnevik Investment AB, you can compare the effects of market volatilities on OptiCept Technologies and Kinnevik Investment 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 OptiCept Technologies with a short position of Kinnevik Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of OptiCept Technologies and Kinnevik Investment.
Diversification Opportunities for OptiCept Technologies and Kinnevik Investment
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between OptiCept and Kinnevik is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding OptiCept Technologies AB and Kinnevik Investment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinnevik Investment and OptiCept 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 OptiCept Technologies AB are associated (or correlated) with Kinnevik Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinnevik Investment has no effect on the direction of OptiCept Technologies i.e., OptiCept Technologies and Kinnevik Investment go up and down completely randomly.
Pair Corralation between OptiCept Technologies and Kinnevik Investment
Assuming the 90 days trading horizon OptiCept Technologies AB is expected to under-perform the Kinnevik Investment. In addition to that, OptiCept Technologies is 2.02 times more volatile than Kinnevik Investment AB. It trades about -0.07 of its total potential returns per unit of risk. Kinnevik Investment AB is currently generating about 0.08 per unit of volatility. If you would invest 7,321 in Kinnevik Investment AB on September 12, 2024 and sell it today you would earn a total of 701.00 from holding Kinnevik Investment AB or generate 9.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OptiCept Technologies AB vs. Kinnevik Investment AB
Performance |
| Timeline |
| OptiCept Technologies |
| Kinnevik Investment |
OptiCept Technologies and Kinnevik Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OptiCept Technologies and Kinnevik Investment
The main advantage of trading using opposite OptiCept Technologies and Kinnevik Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OptiCept Technologies position performs unexpectedly, Kinnevik Investment 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 Kinnevik Investment will offset losses from the drop in Kinnevik Investment's long position.| OptiCept Technologies vs. Atlas Copco AB | OptiCept Technologies vs. Atlas Copco AB | OptiCept Technologies vs. Trelleborg AB | OptiCept Technologies vs. Troax Group AB |
| Kinnevik Investment vs. Catella AB | Kinnevik Investment vs. Catella AB A | Kinnevik Investment vs. KABE Group AB | Kinnevik Investment vs. IAR Systems Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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