Correlation Between SaltX Technology and Firefly AB
Can any of the company-specific risk be diversified away by investing in both SaltX Technology and Firefly AB 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 SaltX Technology and Firefly AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SaltX Technology Holding and Firefly AB, you can compare the effects of market volatilities on SaltX Technology and Firefly 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 SaltX Technology with a short position of Firefly AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of SaltX Technology and Firefly AB.
Diversification Opportunities for SaltX Technology and Firefly AB
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SaltX and Firefly is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding SaltX Technology Holding and Firefly AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firefly AB and SaltX Technology 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 SaltX Technology Holding are associated (or correlated) with Firefly AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firefly AB has no effect on the direction of SaltX Technology i.e., SaltX Technology and Firefly AB go up and down completely randomly.
Pair Corralation between SaltX Technology and Firefly AB
Assuming the 90 days trading horizon SaltX Technology Holding is expected to generate 1.37 times more return on investment than Firefly AB. However, SaltX Technology is 1.37 times more volatile than Firefly AB. It trades about 0.06 of its potential returns per unit of risk. Firefly AB is currently generating about 0.04 per unit of risk. If you would invest 355.00 in SaltX Technology Holding on September 3, 2024 and sell it today you would earn a total of 27.00 from holding SaltX Technology Holding or generate 7.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SaltX Technology Holding vs. Firefly AB
Performance |
| Timeline |
| SaltX Technology Holding |
| Firefly AB |
SaltX Technology and Firefly AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SaltX Technology and Firefly AB
The main advantage of trading using opposite SaltX Technology and Firefly AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SaltX Technology position performs unexpectedly, Firefly 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 Firefly AB will offset losses from the drop in Firefly AB's long position.| SaltX Technology vs. GomSpace Group AB | SaltX Technology vs. Fingerprint Cards AB | SaltX Technology vs. Maha Energy AB | SaltX Technology vs. SolTech Energy Sweden |
| Firefly AB vs. Sprint Bioscience AB | Firefly AB vs. Acarix AS | Firefly AB vs. Annexin Pharmaceuticals AB | Firefly AB vs. KABE 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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