Correlation Between Storskogen Group and Peab AB
Can any of the company-specific risk be diversified away by investing in both Storskogen Group and Peab 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 Storskogen Group and Peab AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Storskogen Group AB and Peab AB, you can compare the effects of market volatilities on Storskogen Group and Peab 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 Storskogen Group with a short position of Peab AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Storskogen Group and Peab AB.
Diversification Opportunities for Storskogen Group and Peab AB
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Storskogen and Peab is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Storskogen Group AB and Peab AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peab AB and Storskogen Group 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 Storskogen Group AB are associated (or correlated) with Peab AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peab AB has no effect on the direction of Storskogen Group i.e., Storskogen Group and Peab AB go up and down completely randomly.
Pair Corralation between Storskogen Group and Peab AB
Assuming the 90 days trading horizon Storskogen Group AB is expected to generate 3.48 times more return on investment than Peab AB. However, Storskogen Group is 3.48 times more volatile than Peab AB. It trades about 0.21 of its potential returns per unit of risk. Peab AB is currently generating about 0.0 per unit of risk. If you would invest 896.00 in Storskogen Group AB on August 30, 2024 and sell it today you would earn a total of 197.00 from holding Storskogen Group AB or generate 21.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Storskogen Group AB vs. Peab AB
Performance |
| Timeline |
| Storskogen Group |
| Peab AB |
Storskogen Group and Peab AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Storskogen Group and Peab AB
The main advantage of trading using opposite Storskogen Group and Peab AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Storskogen Group position performs unexpectedly, Peab 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 Peab AB will offset losses from the drop in Peab AB's long position.| Storskogen Group vs. Samhllsbyggnadsbolaget i Norden | Storskogen Group vs. Sinch AB | Storskogen Group vs. Instalco Intressenter AB | Storskogen Group vs. Hexatronic Group AB |
| Peab AB vs. AVTECH Sweden AB | Peab AB vs. OptiCept Technologies AB | Peab AB vs. Lime Technologies AB | Peab AB vs. Maven Wireless Sweden |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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