Correlation Between Smart Eye and AAC Clyde
Can any of the company-specific risk be diversified away by investing in both Smart Eye and AAC Clyde 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 Smart Eye and AAC Clyde into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart Eye AB and AAC Clyde Space, you can compare the effects of market volatilities on Smart Eye and AAC Clyde 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 Smart Eye with a short position of AAC Clyde. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart Eye and AAC Clyde.
Diversification Opportunities for Smart Eye and AAC Clyde
Excellent diversification
The 3 months correlation between Smart and AAC is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Smart Eye AB and AAC Clyde Space in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAC Clyde Space and Smart Eye 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 Smart Eye AB are associated (or correlated) with AAC Clyde. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAC Clyde Space has no effect on the direction of Smart Eye i.e., Smart Eye and AAC Clyde go up and down completely randomly.
Pair Corralation between Smart Eye and AAC Clyde
Assuming the 90 days trading horizon Smart Eye AB is expected to under-perform the AAC Clyde. But the stock apears to be less risky and, when comparing its historical volatility, Smart Eye AB is 1.78 times less risky than AAC Clyde. The stock trades about -0.13 of its potential returns per unit of risk. The AAC Clyde Space is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,580 in AAC Clyde Space on August 31, 2024 and sell it today you would earn a total of 990.00 from holding AAC Clyde Space or generate 27.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Smart Eye AB vs. AAC Clyde Space
Performance |
| Timeline |
| Smart Eye AB |
| AAC Clyde Space |
Smart Eye and AAC Clyde Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smart Eye and AAC Clyde
The main advantage of trading using opposite Smart Eye and AAC Clyde positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart Eye position performs unexpectedly, AAC Clyde 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 AAC Clyde will offset losses from the drop in AAC Clyde's long position.| Smart Eye vs. Catena Media plc | Smart Eye vs. Kambi Group PLC | Smart Eye vs. Betsson AB | Smart Eye vs. Invisio Communications AB |
| AAC Clyde vs. Saab AB | AAC Clyde vs. CTT Systems AB | AAC Clyde vs. W5 Solutions AB | AAC Clyde vs. AVTECH Sweden 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |