Correlation Between SkiStar AB and Raketech Group
Can any of the company-specific risk be diversified away by investing in both SkiStar AB and Raketech Group 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 SkiStar AB and Raketech Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SkiStar AB and Raketech Group Holding, you can compare the effects of market volatilities on SkiStar AB and Raketech Group 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 SkiStar AB with a short position of Raketech Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of SkiStar AB and Raketech Group.
Diversification Opportunities for SkiStar AB and Raketech Group
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between SkiStar and Raketech is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding SkiStar AB and Raketech Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raketech Group Holding and SkiStar 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 SkiStar AB are associated (or correlated) with Raketech Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raketech Group Holding has no effect on the direction of SkiStar AB i.e., SkiStar AB and Raketech Group go up and down completely randomly.
Pair Corralation between SkiStar AB and Raketech Group
Assuming the 90 days trading horizon SkiStar AB is expected to generate 0.33 times more return on investment than Raketech Group. However, SkiStar AB is 3.06 times less risky than Raketech Group. It trades about 0.22 of its potential returns per unit of risk. Raketech Group Holding is currently generating about -0.2 per unit of risk. If you would invest 15,900 in SkiStar AB on November 8, 2024 and sell it today you would earn a total of 870.00 from holding SkiStar AB or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.96% |
| Values | Daily Returns |
SkiStar AB vs. Raketech Group Holding
Performance |
| Timeline |
| SkiStar AB |
| Raketech Group Holding |
SkiStar AB and Raketech Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SkiStar AB and Raketech Group
The main advantage of trading using opposite SkiStar AB and Raketech Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SkiStar AB position performs unexpectedly, Raketech Group 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 Raketech Group will offset losses from the drop in Raketech Group's long position.| SkiStar AB vs. Peab AB | SkiStar AB vs. Axfood AB | SkiStar AB vs. Thule Group AB | SkiStar AB vs. Avanza Bank Holding |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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