Correlation Between Svedbergs and Lagercrantz Group
Can any of the company-specific risk be diversified away by investing in both Svedbergs and Lagercrantz 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 Svedbergs and Lagercrantz Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Svedbergs i Dalstorp and Lagercrantz Group AB, you can compare the effects of market volatilities on Svedbergs and Lagercrantz 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 Svedbergs with a short position of Lagercrantz Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svedbergs and Lagercrantz Group.
Diversification Opportunities for Svedbergs and Lagercrantz Group
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Svedbergs and Lagercrantz is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Svedbergs i Dalstorp and Lagercrantz Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lagercrantz Group and Svedbergs 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 Svedbergs i Dalstorp are associated (or correlated) with Lagercrantz Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lagercrantz Group has no effect on the direction of Svedbergs i.e., Svedbergs and Lagercrantz Group go up and down completely randomly.
Pair Corralation between Svedbergs and Lagercrantz Group
Assuming the 90 days trading horizon Svedbergs i Dalstorp is expected to under-perform the Lagercrantz Group. In addition to that, Svedbergs is 1.05 times more volatile than Lagercrantz Group AB. It trades about -0.03 of its total potential returns per unit of risk. Lagercrantz Group AB is currently generating about 0.04 per unit of volatility. If you would invest 18,790 in Lagercrantz Group AB on August 29, 2024 and sell it today you would earn a total of 770.00 from holding Lagercrantz Group AB or generate 4.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Svedbergs i Dalstorp vs. Lagercrantz Group AB
Performance |
| Timeline |
| Svedbergs i Dalstorp |
| Lagercrantz Group |
Svedbergs and Lagercrantz Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Svedbergs and Lagercrantz Group
The main advantage of trading using opposite Svedbergs and Lagercrantz Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svedbergs position performs unexpectedly, Lagercrantz 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 Lagercrantz Group will offset losses from the drop in Lagercrantz Group's long position.| Svedbergs vs. Systemair AB | Svedbergs vs. Softronic AB | Svedbergs vs. Inwido AB | Svedbergs vs. Lindab International AB |
| Lagercrantz Group vs. Addtech AB | Lagercrantz Group vs. Lifco AB | Lagercrantz Group vs. Indutrade AB | Lagercrantz Group vs. Vitec Software Group |
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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