Correlation Between Ultimovacs ASA and Circa Group
Can any of the company-specific risk be diversified away by investing in both Ultimovacs ASA and Circa 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 Ultimovacs ASA and Circa Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultimovacs ASA and Circa Group AS, you can compare the effects of market volatilities on Ultimovacs ASA and Circa 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 Ultimovacs ASA with a short position of Circa Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultimovacs ASA and Circa Group.
Diversification Opportunities for Ultimovacs ASA and Circa Group
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ultimovacs and Circa is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ultimovacs ASA and Circa Group AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Circa Group AS and Ultimovacs ASA 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 Ultimovacs ASA are associated (or correlated) with Circa Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Circa Group AS has no effect on the direction of Ultimovacs ASA i.e., Ultimovacs ASA and Circa Group go up and down completely randomly.
Pair Corralation between Ultimovacs ASA and Circa Group
Assuming the 90 days trading horizon Ultimovacs ASA is expected to under-perform the Circa Group. But the stock apears to be less risky and, when comparing its historical volatility, Ultimovacs ASA is 1.11 times less risky than Circa Group. The stock trades about -0.09 of its potential returns per unit of risk. The Circa Group AS is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 114.00 in Circa Group AS on September 2, 2024 and sell it today you would lose (50.00) from holding Circa Group AS or give up 43.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultimovacs ASA vs. Circa Group AS
Performance |
| Timeline |
| Ultimovacs ASA |
| Circa Group AS |
Ultimovacs ASA and Circa Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultimovacs ASA and Circa Group
The main advantage of trading using opposite Ultimovacs ASA and Circa Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultimovacs ASA position performs unexpectedly, Circa 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 Circa Group will offset losses from the drop in Circa Group's long position.| Ultimovacs ASA vs. Carasent ASA | Ultimovacs ASA vs. Bergenbio ASA | Ultimovacs ASA vs. Photocure | Ultimovacs ASA vs. Kitron ASA |
| Circa Group vs. Carasent ASA | Circa Group vs. Bergenbio ASA | Circa Group vs. Photocure | Circa Group vs. Kitron ASA |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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