Correlation Between Sinch AB and Lidds AB
Can any of the company-specific risk be diversified away by investing in both Sinch AB and Lidds 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 Sinch AB and Lidds AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sinch AB and Lidds AB, you can compare the effects of market volatilities on Sinch AB and Lidds 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 Sinch AB with a short position of Lidds AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinch AB and Lidds AB.
Diversification Opportunities for Sinch AB and Lidds AB
Average diversification
The 3 months correlation between Sinch and Lidds is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Sinch AB and Lidds AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lidds AB and Sinch 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 Sinch AB are associated (or correlated) with Lidds AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lidds AB has no effect on the direction of Sinch AB i.e., Sinch AB and Lidds AB go up and down completely randomly.
Pair Corralation between Sinch AB and Lidds AB
Assuming the 90 days trading horizon Sinch AB is expected to under-perform the Lidds AB. But the stock apears to be less risky and, when comparing its historical volatility, Sinch AB is 2.44 times less risky than Lidds AB. The stock trades about -0.26 of its potential returns per unit of risk. The Lidds AB is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Lidds AB on August 28, 2024 and sell it today you would lose (1.00) from holding Lidds AB or give up 8.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinch AB vs. Lidds AB
Performance |
| Timeline |
| Sinch AB |
| Lidds AB |
Sinch AB and Lidds AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinch AB and Lidds AB
The main advantage of trading using opposite Sinch AB and Lidds AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinch AB position performs unexpectedly, Lidds 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 Lidds AB will offset losses from the drop in Lidds AB's long position.| Sinch AB vs. Lidds AB | Sinch AB vs. Serstech AB | Sinch AB vs. Transtema Group AB | Sinch AB vs. Enorama Pharma 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |