Correlation Between SSAB AB and Telia Company
Can any of the company-specific risk be diversified away by investing in both SSAB AB and Telia Company 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 SSAB AB and Telia Company into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSAB AB ser and Telia Company AB, you can compare the effects of market volatilities on SSAB AB and Telia Company 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 SSAB AB with a short position of Telia Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSAB AB and Telia Company.
Diversification Opportunities for SSAB AB and Telia Company
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SSAB and Telia is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding SSAB AB ser and Telia Company AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telia Company and SSAB 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 SSAB AB ser are associated (or correlated) with Telia Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telia Company has no effect on the direction of SSAB AB i.e., SSAB AB and Telia Company go up and down completely randomly.
Pair Corralation between SSAB AB and Telia Company
Assuming the 90 days trading horizon SSAB AB ser is expected to under-perform the Telia Company. In addition to that, SSAB AB is 1.77 times more volatile than Telia Company AB. It trades about -0.02 of its total potential returns per unit of risk. Telia Company AB is currently generating about 0.0 per unit of volatility. If you would invest 277.00 in Telia Company AB on August 27, 2024 and sell it today you would lose (1.00) from holding Telia Company AB or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SSAB AB ser vs. Telia Company AB
Performance |
| Timeline |
| SSAB AB ser |
| Telia Company |
SSAB AB and Telia Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSAB AB and Telia Company
The main advantage of trading using opposite SSAB AB and Telia Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSAB AB position performs unexpectedly, Telia Company 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 Telia Company will offset losses from the drop in Telia Company's long position.| SSAB AB vs. Outokumpu Oyj | SSAB AB vs. Nordea Bank Abp | SSAB AB vs. Telia Company AB | SSAB AB vs. Wartsila Oyj Abp |
| Telia Company vs. Nordea Bank Abp | Telia Company vs. Sampo Oyj A | Telia Company vs. Fortum Oyj | Telia Company vs. Wartsila Oyj Abp |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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