Correlation Between Snap and Desenio Group
Can any of the company-specific risk be diversified away by investing in both Snap and Desenio 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 Snap and Desenio Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Desenio Group AB, you can compare the effects of market volatilities on Snap and Desenio 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 Snap with a short position of Desenio Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Desenio Group.
Diversification Opportunities for Snap and Desenio Group
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Snap and Desenio is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Desenio Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Desenio Group 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 Desenio Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Desenio Group AB has no effect on the direction of Snap i.e., Snap and Desenio Group go up and down completely randomly.
Pair Corralation between Snap and Desenio Group
Given the investment horizon of 90 days Snap is expected to generate 1.68 times less return on investment than Desenio Group. But when comparing it to its historical volatility, Snap Inc is 3.0 times less risky than Desenio Group. It trades about 0.1 of its potential returns per unit of risk. Desenio Group AB is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Desenio Group AB on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Desenio Group AB or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Snap Inc vs. Desenio Group AB
Performance |
| Timeline |
| Snap Inc |
| Desenio Group AB |
Snap and Desenio Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Desenio Group
The main advantage of trading using opposite Snap and Desenio Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Desenio 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 Desenio Group will offset losses from the drop in Desenio Group's long position.The idea behind Snap Inc and Desenio Group 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.| Desenio Group vs. Rugvista Group AB | Desenio Group vs. Cint Group AB | Desenio Group vs. BHG Group AB | Desenio Group vs. Lyko Group A |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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