Correlation Between 24SevenOffice Scandinavia and Systemair

Can any of the company-specific risk be diversified away by investing in both 24SevenOffice Scandinavia and Systemair 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 24SevenOffice Scandinavia and Systemair into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 24SevenOffice Scandinavia AB and Systemair AB, you can compare the effects of market volatilities on 24SevenOffice Scandinavia and Systemair 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 24SevenOffice Scandinavia with a short position of Systemair. Check out your portfolio center. Please also check ongoing floating volatility patterns of 24SevenOffice Scandinavia and Systemair.

Diversification Opportunities for 24SevenOffice Scandinavia and Systemair

-0.61

Correlation Coefficient

24SevenOffice Scandinavia  Systemair

Excellent diversification

The 3 months correlation between 24SevenOffice and Systemair is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding 24SevenOffice Scandinavia AB and Systemair AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Systemair AB and 24SevenOffice Scandinavia 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 24SevenOffice Scandinavia AB are associated (or correlated) with Systemair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Systemair AB has no effect on the direction of 24SevenOffice Scandinavia i.e., 24SevenOffice Scandinavia and Systemair go up and down completely randomly.

Pair Corralation between 24SevenOffice Scandinavia and Systemair

Assuming the 90 days trading horizon 24SevenOffice Scandinavia AB is expected to generate 0.68 times more return on investment than Systemair. However, 24SevenOffice Scandinavia AB is 1.46 times less risky than Systemair. It trades about 0.44 of its potential returns per unit of risk. Systemair AB is currently generating about -0.2 per unit of risk. If you would invest  1,760  in 24SevenOffice Scandinavia AB on October 24, 2024 and sell it today you would earn a total of  210.00  from holding 24SevenOffice Scandinavia AB or generate 11.93% return on investment over 90 days.

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

24SevenOffice Scandinavia AB  vs.  Systemair AB

24SevenOffice Scandinavia

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in 24SevenOffice Scandinavia AB are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, 24SevenOffice Scandinavia unveiled solid returns over the last few months and may actually be approaching a breakup point.

Systemair AB

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with 24SevenOffice Scandinavia and Systemair

The main advantage of trading using opposite 24SevenOffice Scandinavia and Systemair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 24SevenOffice Scandinavia position performs unexpectedly, Systemair 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 Systemair will offset losses from the drop in Systemair's long position.

The idea behind 24SevenOffice Scandinavia AB and Systemair 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.