Correlation Between USWE Sports and AB Sagax
Can any of the company-specific risk be diversified away by investing in both USWE Sports and AB Sagax 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 USWE Sports and AB Sagax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE Sports AB and AB Sagax, you can compare the effects of market volatilities on USWE Sports and AB Sagax 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 USWE Sports with a short position of AB Sagax. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE Sports and AB Sagax.
Diversification Opportunities for USWE Sports and AB Sagax
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between USWE and SAGA-A is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding USWE Sports AB and AB Sagax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB Sagax and USWE Sports 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 USWE Sports AB are associated (or correlated) with AB Sagax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AB Sagax has no effect on the direction of USWE Sports i.e., USWE Sports and AB Sagax go up and down completely randomly.
Pair Corralation between USWE Sports and AB Sagax
Assuming the 90 days trading horizon USWE Sports AB is expected to generate 1.97 times more return on investment than AB Sagax. However, USWE Sports is 1.97 times more volatile than AB Sagax. It trades about 0.2 of its potential returns per unit of risk. AB Sagax is currently generating about -0.22 per unit of risk. If you would invest 685.00 in USWE Sports AB on September 3, 2024 and sell it today you would earn a total of 235.00 from holding USWE Sports AB or generate 34.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE Sports AB vs. AB Sagax
Performance |
| Timeline |
| USWE Sports AB |
| AB Sagax |
USWE Sports and AB Sagax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE Sports and AB Sagax
The main advantage of trading using opposite USWE Sports and AB Sagax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE Sports position performs unexpectedly, AB Sagax 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 AB Sagax will offset losses from the drop in AB Sagax's long position.| USWE Sports vs. Truecaller AB | USWE Sports vs. Dedicare AB | USWE Sports vs. RVRC Holding AB | USWE Sports vs. AddLife AB |
| AB Sagax vs. Cibus Nordic Real | AB Sagax vs. Samhaellsbyggnadsbolaget i Norden | AB Sagax vs. ALM Equity AB | AB Sagax vs. Castellum AB |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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