Correlation Between Zaptec AS and Scatec Solar
Can any of the company-specific risk be diversified away by investing in both Zaptec AS and Scatec Solar 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 Zaptec AS and Scatec Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zaptec AS and Scatec Solar OL, you can compare the effects of market volatilities on Zaptec AS and Scatec Solar 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 Zaptec AS with a short position of Scatec Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zaptec AS and Scatec Solar.
Diversification Opportunities for Zaptec AS and Scatec Solar
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Zaptec and Scatec is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Zaptec AS and Scatec Solar OL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scatec Solar OL and Zaptec AS 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 Zaptec AS are associated (or correlated) with Scatec Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scatec Solar OL has no effect on the direction of Zaptec AS i.e., Zaptec AS and Scatec Solar go up and down completely randomly.
Pair Corralation between Zaptec AS and Scatec Solar
Assuming the 90 days trading horizon Zaptec AS is expected to under-perform the Scatec Solar. In addition to that, Zaptec AS is 2.57 times more volatile than Scatec Solar OL. It trades about -0.08 of its total potential returns per unit of risk. Scatec Solar OL is currently generating about 0.04 per unit of volatility. If you would invest 7,960 in Scatec Solar OL on September 1, 2024 and sell it today you would earn a total of 100.00 from holding Scatec Solar OL or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zaptec AS vs. Scatec Solar OL
Performance |
| Timeline |
| Zaptec AS |
| Scatec Solar OL |
Zaptec AS and Scatec Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zaptec AS and Scatec Solar
The main advantage of trading using opposite Zaptec AS and Scatec Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zaptec AS position performs unexpectedly, Scatec Solar 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 Scatec Solar will offset losses from the drop in Scatec Solar's long position.The idea behind Zaptec AS and Scatec Solar OL pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Scatec Solar vs. Hexagon Purus As | Scatec Solar vs. Zaptec AS | Scatec Solar vs. Nel ASA | Scatec Solar vs. Elkem 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Transaction History View history of all your transactions and understand their impact on performance |