Correlation Between SEB SA and Amplitude Surgical
Can any of the company-specific risk be diversified away by investing in both SEB SA and Amplitude Surgical 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 SEB SA and Amplitude Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEB SA and Amplitude Surgical SAS, you can compare the effects of market volatilities on SEB SA and Amplitude Surgical 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 SEB SA with a short position of Amplitude Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEB SA and Amplitude Surgical.
Diversification Opportunities for SEB SA and Amplitude Surgical
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between SEB and Amplitude is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding SEB SA and Amplitude Surgical SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplitude Surgical SAS and SEB SA 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 SEB SA are associated (or correlated) with Amplitude Surgical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplitude Surgical SAS has no effect on the direction of SEB SA i.e., SEB SA and Amplitude Surgical go up and down completely randomly.
Pair Corralation between SEB SA and Amplitude Surgical
Assuming the 90 days horizon SEB SA is expected to under-perform the Amplitude Surgical. But the stock apears to be less risky and, when comparing its historical volatility, SEB SA is 1.27 times less risky than Amplitude Surgical. The stock trades about -0.08 of its potential returns per unit of risk. The Amplitude Surgical SAS is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 292.00 in Amplitude Surgical SAS on August 29, 2024 and sell it today you would earn a total of 34.00 from holding Amplitude Surgical SAS or generate 11.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEB SA vs. Amplitude Surgical SAS
Performance |
| Timeline |
| SEB SA |
| Amplitude Surgical SAS |
SEB SA and Amplitude Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEB SA and Amplitude Surgical
The main advantage of trading using opposite SEB SA and Amplitude Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEB SA position performs unexpectedly, Amplitude Surgical 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 Amplitude Surgical will offset losses from the drop in Amplitude Surgical's long position.The idea behind SEB SA and Amplitude Surgical SAS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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