Correlation Between SYSTEMAIR and Crown Holdings

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

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

Diversification Opportunities for SYSTEMAIR and Crown Holdings

0.0

Correlation Coefficient

SYSTEMAIR  Crown Holdings

Pay attention - limited upside

The 3 months correlation between SYSTEMAIR and Crown is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SYSTEMAIR AB and Crown Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crown Holdings and SYSTEMAIR 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 SYSTEMAIR AB are associated (or correlated) with Crown Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crown Holdings has no effect on the direction of SYSTEMAIR i.e., SYSTEMAIR and Crown Holdings go up and down completely randomly.

Pair Corralation between SYSTEMAIR and Crown Holdings

If you would invest (100.00) in Crown Holdings on October 22, 2024 and sell it today you would earn a total of  100.00  from holding Crown Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SYSTEMAIR AB  vs.  Crown Holdings

SYSTEMAIR AB

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SYSTEMAIR AB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SYSTEMAIR may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Crown Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crown Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Crown Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SYSTEMAIR and Crown Holdings

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

The idea behind SYSTEMAIR AB and Crown Holdings 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.

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.