Correlation Between Saule Technologies and Vakomtek
Can any of the company-specific risk be diversified away by investing in both Saule Technologies and Vakomtek 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 Saule Technologies and Vakomtek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saule Technologies SA and Vakomtek, you can compare the effects of market volatilities on Saule Technologies and Vakomtek 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 Saule Technologies with a short position of Vakomtek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saule Technologies and Vakomtek.
Diversification Opportunities for Saule Technologies and Vakomtek
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saule and Vakomtek is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Saule Technologies SA and Vakomtek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vakomtek and Saule Technologies 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 Saule Technologies SA are associated (or correlated) with Vakomtek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vakomtek has no effect on the direction of Saule Technologies i.e., Saule Technologies and Vakomtek go up and down completely randomly.
Pair Corralation between Saule Technologies and Vakomtek
Assuming the 90 days trading horizon Saule Technologies SA is expected to under-perform the Vakomtek. In addition to that, Saule Technologies is 3.7 times more volatile than Vakomtek. It trades about -0.1 of its total potential returns per unit of risk. Vakomtek is currently generating about 0.25 per unit of volatility. If you would invest 92.00 in Vakomtek on August 30, 2024 and sell it today you would earn a total of 2.00 from holding Vakomtek or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 25.0% |
| Values | Daily Returns |
Saule Technologies SA vs. Vakomtek
Performance |
| Timeline |
| Saule Technologies |
| Vakomtek |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Saule Technologies and Vakomtek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saule Technologies and Vakomtek
The main advantage of trading using opposite Saule Technologies and Vakomtek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saule Technologies position performs unexpectedly, Vakomtek 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 Vakomtek will offset losses from the drop in Vakomtek's long position.| Saule Technologies vs. Clean Carbon Energy | Saule Technologies vs. ADX | Saule Technologies vs. Agroliga Group PLC | Saule Technologies vs. Vee SA |
| Vakomtek vs. MW Trade SA | Vakomtek vs. Globe Trade Centre | Vakomtek vs. LSI Software SA | Vakomtek vs. Road Studio SA |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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