Correlation Between Saab AB and Essity AB
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By analyzing existing cross correlation between Saab AB and Essity AB, you can compare the effects of market volatilities on Saab AB and Essity AB 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 Saab AB with a short position of Essity AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saab AB and Essity AB.
Diversification Opportunities for Saab AB and Essity AB
Good diversification
The 3 months correlation between Saab and Essity is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Saab AB and Essity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Essity AB and Saab 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 Saab AB are associated (or correlated) with Essity AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Essity AB has no effect on the direction of Saab AB i.e., Saab AB and Essity AB go up and down completely randomly.
Pair Corralation between Saab AB and Essity AB
Assuming the 90 days trading horizon Saab AB is expected to generate 2.02 times more return on investment than Essity AB. However, Saab AB is 2.02 times more volatile than Essity AB. It trades about 0.08 of its potential returns per unit of risk. Essity AB is currently generating about 0.04 per unit of risk. If you would invest 10,613 in Saab AB on October 23, 2024 and sell it today you would earn a total of 11,637 from holding Saab AB or generate 109.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saab AB vs. Essity AB
Performance |
| Timeline |
| Saab AB |
| Essity AB |
Saab AB and Essity AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saab AB and Essity AB
The main advantage of trading using opposite Saab AB and Essity AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saab AB position performs unexpectedly, Essity AB 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 Essity AB will offset losses from the drop in Essity AB's long position.| Saab AB vs. SSAB AB | Saab AB vs. Boliden AB | Saab AB vs. Sandvik AB | Saab AB vs. Telefonaktiebolaget LM Ericsson |
| Essity AB vs. Svenska Cellulosa Aktiebolaget | Essity AB vs. ASSA ABLOY AB | Essity AB vs. AB Electrolux | Essity AB vs. AB SKF |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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