Correlation Between SolTech Energy and SaltX Technology
Can any of the company-specific risk be diversified away by investing in both SolTech Energy and SaltX Technology 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 SolTech Energy and SaltX Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SolTech Energy Sweden and SaltX Technology Holding, you can compare the effects of market volatilities on SolTech Energy and SaltX Technology 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 SolTech Energy with a short position of SaltX Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SolTech Energy and SaltX Technology.
Diversification Opportunities for SolTech Energy and SaltX Technology
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SolTech and SaltX is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding SolTech Energy Sweden and SaltX Technology Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SaltX Technology Holding and SolTech Energy 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 SolTech Energy Sweden are associated (or correlated) with SaltX Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SaltX Technology Holding has no effect on the direction of SolTech Energy i.e., SolTech Energy and SaltX Technology go up and down completely randomly.
Pair Corralation between SolTech Energy and SaltX Technology
Assuming the 90 days trading horizon SolTech Energy Sweden is expected to under-perform the SaltX Technology. But the stock apears to be less risky and, when comparing its historical volatility, SolTech Energy Sweden is 1.12 times less risky than SaltX Technology. The stock trades about -0.28 of its potential returns per unit of risk. The SaltX Technology Holding is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 330.00 in SaltX Technology Holding on August 25, 2024 and sell it today you would earn a total of 18.00 from holding SaltX Technology Holding or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SolTech Energy Sweden vs. SaltX Technology Holding
Performance |
| Timeline |
| SolTech Energy Sweden |
| SaltX Technology Holding |
SolTech Energy and SaltX Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SolTech Energy and SaltX Technology
The main advantage of trading using opposite SolTech Energy and SaltX Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SolTech Energy position performs unexpectedly, SaltX Technology 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 SaltX Technology will offset losses from the drop in SaltX Technology's long position.| SolTech Energy vs. Eolus Vind AB | SolTech Energy vs. Sinch AB | SolTech Energy vs. Embracer Group AB | SolTech Energy vs. Powercell Sweden |
| SaltX Technology vs. Lagercrantz Group AB | SaltX Technology vs. Addtech AB | SaltX Technology vs. AddLife AB | SaltX Technology vs. Bufab Holding 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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