Correlation Between Zignsec AB and Lohilo Foods
Can any of the company-specific risk be diversified away by investing in both Zignsec AB and Lohilo Foods 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 Zignsec AB and Lohilo Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zignsec AB and Lohilo Foods AB, you can compare the effects of market volatilities on Zignsec AB and Lohilo Foods 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 Zignsec AB with a short position of Lohilo Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zignsec AB and Lohilo Foods.
Diversification Opportunities for Zignsec AB and Lohilo Foods
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zignsec and Lohilo is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Zignsec AB and Lohilo Foods AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lohilo Foods AB and Zignsec 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 Zignsec AB are associated (or correlated) with Lohilo Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lohilo Foods AB has no effect on the direction of Zignsec AB i.e., Zignsec AB and Lohilo Foods go up and down completely randomly.
Pair Corralation between Zignsec AB and Lohilo Foods
Assuming the 90 days trading horizon Zignsec AB is expected to generate 3.47 times more return on investment than Lohilo Foods. However, Zignsec AB is 3.47 times more volatile than Lohilo Foods AB. It trades about 0.13 of its potential returns per unit of risk. Lohilo Foods AB is currently generating about -0.14 per unit of risk. If you would invest 70.00 in Zignsec AB on August 29, 2024 and sell it today you would earn a total of 68.00 from holding Zignsec AB or generate 97.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 67.69% |
| Values | Daily Returns |
Zignsec AB vs. Lohilo Foods AB
Performance |
| Timeline |
| Zignsec AB |
| Lohilo Foods AB |
Zignsec AB and Lohilo Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zignsec AB and Lohilo Foods
The main advantage of trading using opposite Zignsec AB and Lohilo Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zignsec AB position performs unexpectedly, Lohilo Foods 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 Lohilo Foods will offset losses from the drop in Lohilo Foods' long position.| Zignsec AB vs. Smart Eye AB | Zignsec AB vs. Embracer Group AB | Zignsec AB vs. Zwipe AS | Zignsec AB vs. Sinch AB |
| Lohilo Foods vs. Smart Eye AB | Lohilo Foods vs. Kamux Suomi Oy | Lohilo Foods vs. Zignsec AB | Lohilo Foods vs. Harvia Oyj |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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