Correlation Between Svenska Cellulosa and Identiv
Can any of the company-specific risk be diversified away by investing in both Svenska Cellulosa and Identiv 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 Svenska Cellulosa and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Svenska Cellulosa Aktiebolaget and Identiv, you can compare the effects of market volatilities on Svenska Cellulosa and Identiv 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 Svenska Cellulosa with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svenska Cellulosa and Identiv.
Diversification Opportunities for Svenska Cellulosa and Identiv
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Svenska and Identiv is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Svenska Cellulosa Aktiebolaget and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Svenska Cellulosa 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 Svenska Cellulosa Aktiebolaget are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Svenska Cellulosa i.e., Svenska Cellulosa and Identiv go up and down completely randomly.
Pair Corralation between Svenska Cellulosa and Identiv
Assuming the 90 days horizon Svenska Cellulosa Aktiebolaget is expected to generate 0.38 times more return on investment than Identiv. However, Svenska Cellulosa Aktiebolaget is 2.61 times less risky than Identiv. It trades about 0.11 of its potential returns per unit of risk. Identiv is currently generating about -0.06 per unit of risk. If you would invest 1,289 in Svenska Cellulosa Aktiebolaget on November 28, 2024 and sell it today you would earn a total of 36.00 from holding Svenska Cellulosa Aktiebolaget or generate 2.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Svenska Cellulosa Aktiebolaget vs. Identiv
Performance |
| Timeline |
| Svenska Cellulosa |
| Identiv |
Svenska Cellulosa and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Svenska Cellulosa and Identiv
The main advantage of trading using opposite Svenska Cellulosa and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svenska Cellulosa position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Svenska Cellulosa vs. United Utilities Group | Svenska Cellulosa vs. G III APPAREL GROUP | Svenska Cellulosa vs. SCANSOURCE | Svenska Cellulosa vs. Urban Outfitters |
| Identiv vs. Guidewire Software | Identiv vs. Chengdu PUTIAN Telecommunications | Identiv vs. Rocket Internet SE | Identiv vs. Magic Software Enterprises |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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