Correlation Between Rejlers AB and Systemair
Can any of the company-specific risk be diversified away by investing in both Rejlers AB 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 Rejlers AB and Systemair into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rejlers AB and Systemair AB, you can compare the effects of market volatilities on Rejlers AB 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 Rejlers AB with a short position of Systemair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rejlers AB and Systemair.
Diversification Opportunities for Rejlers AB and Systemair
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rejlers and Systemair is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Rejlers AB and Systemair AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Systemair AB and Rejlers AB 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 Rejlers AB 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 Rejlers AB i.e., Rejlers AB and Systemair go up and down completely randomly.
Pair Corralation between Rejlers AB and Systemair
Assuming the 90 days trading horizon Rejlers AB is expected to generate 2.39 times less return on investment than Systemair. But when comparing it to its historical volatility, Rejlers AB is 1.1 times less risky than Systemair. It trades about 0.02 of its potential returns per unit of risk. Systemair AB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,665 in Systemair AB on August 30, 2024 and sell it today you would earn a total of 2,445 from holding Systemair AB or generate 36.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rejlers AB vs. Systemair AB
Performance |
| Timeline |
| Rejlers AB |
| Systemair AB |
Rejlers AB and Systemair Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rejlers AB and Systemair
The main advantage of trading using opposite Rejlers AB and Systemair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rejlers AB 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.| Rejlers AB vs. Proact IT Group | Rejlers AB vs. Nederman Holding AB | Rejlers AB vs. Sweco AB | Rejlers AB vs. Rottneros AB |
| Systemair vs. Lindab International AB | Systemair vs. Nolato AB | Systemair vs. Sweco AB | Systemair vs. Troax 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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