Correlation Between Volati AB and AB Sagax
Can any of the company-specific risk be diversified away by investing in both Volati AB 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 Volati AB and AB Sagax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Volati AB and AB Sagax, you can compare the effects of market volatilities on Volati AB 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 Volati AB with a short position of AB Sagax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Volati AB and AB Sagax.
Diversification Opportunities for Volati AB and AB Sagax
Very weak diversification
The 3 months correlation between Volati and SAGA-A is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Volati AB and AB Sagax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB Sagax and Volati AB 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 Volati 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 Volati AB i.e., Volati AB and AB Sagax go up and down completely randomly.
Pair Corralation between Volati AB and AB Sagax
Assuming the 90 days trading horizon Volati AB is expected to generate 1.27 times more return on investment than AB Sagax. However, Volati AB is 1.27 times more volatile than AB Sagax. It trades about 0.17 of its potential returns per unit of risk. AB Sagax is currently generating about 0.2 per unit of risk. If you would invest 9,540 in Volati AB on November 4, 2024 and sell it today you would earn a total of 1,080 from holding Volati AB or generate 11.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Volati AB vs. AB Sagax
Performance |
| Timeline |
| Volati AB |
| AB Sagax |
Volati AB and AB Sagax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Volati AB and AB Sagax
The main advantage of trading using opposite Volati AB and AB Sagax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Volati AB 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.| Volati AB vs. Green Landscaping Group | Volati AB vs. Instalco Intressenter AB | Volati AB vs. Fasadgruppen Group AB |
| AB Sagax vs. Nexam Chemical Holding | AB Sagax vs. FormPipe Software AB | AB Sagax vs. Investment AB Oresund | AB Sagax vs. COOR Service Management |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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