Correlation Between Raketech Group and Invisio Communications
Can any of the company-specific risk be diversified away by investing in both Raketech Group and Invisio Communications 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 Raketech Group and Invisio Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raketech Group Holding and Invisio Communications AB, you can compare the effects of market volatilities on Raketech Group and Invisio Communications 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 Raketech Group with a short position of Invisio Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raketech Group and Invisio Communications.
Diversification Opportunities for Raketech Group and Invisio Communications
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Raketech and Invisio is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Raketech Group Holding and Invisio Communications AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invisio Communications and Raketech 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 Raketech Group Holding are associated (or correlated) with Invisio Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invisio Communications has no effect on the direction of Raketech Group i.e., Raketech Group and Invisio Communications go up and down completely randomly.
Pair Corralation between Raketech Group and Invisio Communications
Assuming the 90 days trading horizon Raketech Group Holding is expected to under-perform the Invisio Communications. In addition to that, Raketech Group is 1.41 times more volatile than Invisio Communications AB. It trades about -0.14 of its total potential returns per unit of risk. Invisio Communications AB is currently generating about 0.09 per unit of volatility. If you would invest 18,178 in Invisio Communications AB on September 2, 2024 and sell it today you would earn a total of 10,022 from holding Invisio Communications AB or generate 55.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raketech Group Holding vs. Invisio Communications AB
Performance |
| Timeline |
| Raketech Group Holding |
| Invisio Communications |
Raketech Group and Invisio Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raketech Group and Invisio Communications
The main advantage of trading using opposite Raketech Group and Invisio Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raketech Group position performs unexpectedly, Invisio Communications 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 Invisio Communications will offset losses from the drop in Invisio Communications' long position.| Raketech Group vs. Catena Media plc | Raketech Group vs. Better Collective | Raketech Group vs. Betsson AB | Raketech Group vs. Kambi Group PLC |
| Invisio Communications vs. Hexatronic Group AB | Invisio Communications vs. CellaVision AB | Invisio Communications vs. Xvivo Perfusion AB | Invisio Communications vs. Sectra 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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