Correlation Between Seraphim Space and Axfood AB
Can any of the company-specific risk be diversified away by investing in both Seraphim Space and Axfood AB 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 Seraphim Space and Axfood AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seraphim Space Investment and Axfood AB, you can compare the effects of market volatilities on Seraphim Space and Axfood AB 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 Seraphim Space with a short position of Axfood AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seraphim Space and Axfood AB.
Diversification Opportunities for Seraphim Space and Axfood AB
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Seraphim and Axfood is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Seraphim Space Investment and Axfood AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axfood AB and Seraphim Space 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 Seraphim Space Investment are associated (or correlated) with Axfood AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axfood AB has no effect on the direction of Seraphim Space i.e., Seraphim Space and Axfood AB go up and down completely randomly.
Pair Corralation between Seraphim Space and Axfood AB
Assuming the 90 days trading horizon Seraphim Space Investment is expected to generate 3.22 times more return on investment than Axfood AB. However, Seraphim Space is 3.22 times more volatile than Axfood AB. It trades about 0.03 of its potential returns per unit of risk. Axfood AB is currently generating about -0.01 per unit of risk. If you would invest 4,810 in Seraphim Space Investment on October 11, 2024 and sell it today you would earn a total of 770.00 from holding Seraphim Space Investment or generate 16.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Seraphim Space Investment vs. Axfood AB
Performance |
| Timeline |
| Seraphim Space Investment |
| Axfood AB |
Seraphim Space and Axfood AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seraphim Space and Axfood AB
The main advantage of trading using opposite Seraphim Space and Axfood AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seraphim Space position performs unexpectedly, Axfood AB 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 Axfood AB will offset losses from the drop in Axfood AB's long position.| Seraphim Space vs. Clean Power Hydrogen | Seraphim Space vs. Naked Wines plc | Seraphim Space vs. United Internet AG | Seraphim Space vs. Molson Coors Beverage |
| Axfood AB vs. Sealed Air Corp | Axfood AB vs. Heavitree Brewery | Axfood AB vs. Mindflair Plc | Axfood AB vs. Pentair PLC |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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