Correlation Between Snap and Avensia Publ
Can any of the company-specific risk be diversified away by investing in both Snap and Avensia Publ 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 Snap and Avensia Publ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Avensia publ AB, you can compare the effects of market volatilities on Snap and Avensia Publ 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 Snap with a short position of Avensia Publ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Avensia Publ.
Diversification Opportunities for Snap and Avensia Publ
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Snap and Avensia is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Avensia publ AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avensia publ AB and Snap 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 Snap Inc are associated (or correlated) with Avensia Publ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avensia publ AB has no effect on the direction of Snap i.e., Snap and Avensia Publ go up and down completely randomly.
Pair Corralation between Snap and Avensia Publ
Given the investment horizon of 90 days Snap Inc is expected to under-perform the Avensia Publ. In addition to that, Snap is 1.65 times more volatile than Avensia publ AB. It trades about -0.03 of its total potential returns per unit of risk. Avensia publ AB is currently generating about -0.03 per unit of volatility. If you would invest 798.00 in Avensia publ AB on September 1, 2024 and sell it today you would lose (12.00) from holding Avensia publ AB or give up 1.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Snap Inc vs. Avensia publ AB
Performance |
| Timeline |
| Snap Inc |
| Avensia publ AB |
Snap and Avensia Publ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Avensia Publ
The main advantage of trading using opposite Snap and Avensia Publ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Avensia Publ 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 Avensia Publ will offset losses from the drop in Avensia Publ's long position.The idea behind Snap Inc and Avensia publ AB 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.| Avensia Publ vs. FormPipe Software AB | Avensia Publ vs. Micro Systemation AB | Avensia Publ vs. CTT Systems AB | Avensia Publ vs. CAG Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |