Correlation Between Firan Technology and Svenska Handelsbanken

Can any of the company-specific risk be diversified away by investing in both Firan Technology and Svenska Handelsbanken 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 Firan Technology and Svenska Handelsbanken into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Firan Technology Group and Svenska Handelsbanken AB, you can compare the effects of market volatilities on Firan Technology and Svenska Handelsbanken 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 Firan Technology with a short position of Svenska Handelsbanken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firan Technology and Svenska Handelsbanken.

Diversification Opportunities for Firan Technology and Svenska Handelsbanken

-0.19

Correlation Coefficient

Firan Technology  Svenska Handelsbanken

Good diversification

The 3 months correlation between Firan and Svenska is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Firan Technology Group and Svenska Handelsbanken AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Svenska Handelsbanken and Firan Technology 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 Firan Technology Group are associated (or correlated) with Svenska Handelsbanken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Svenska Handelsbanken has no effect on the direction of Firan Technology i.e., Firan Technology and Svenska Handelsbanken go up and down completely randomly.

Pair Corralation between Firan Technology and Svenska Handelsbanken

Assuming the 90 days trading horizon Firan Technology Group is expected to under-perform the Svenska Handelsbanken. But the stock apears to be less risky and, when comparing its historical volatility, Firan Technology Group is 1.51 times less risky than Svenska Handelsbanken. The stock trades about -0.04 of its potential returns per unit of risk. The Svenska Handelsbanken AB is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,271  in Svenska Handelsbanken AB on December 23, 2024 and sell it today you would earn a total of  385.00  from holding Svenska Handelsbanken AB or generate 30.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Firan Technology Group  vs.  Svenska Handelsbanken AB

Firan Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Firan Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Firan Technology is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Svenska Handelsbanken

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Svenska Handelsbanken AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical indicators, Svenska Handelsbanken reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Firan Technology and Svenska Handelsbanken

The main advantage of trading using opposite Firan Technology and Svenska Handelsbanken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firan Technology position performs unexpectedly, Svenska Handelsbanken 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 Svenska Handelsbanken will offset losses from the drop in Svenska Handelsbanken's long position.

The idea behind Firan Technology Group and Svenska Handelsbanken AB 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.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..