Correlation Between Superior Plus and Swedbank Robur

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

By analyzing existing cross correlation between Superior Plus Corp and Swedbank Robur Corporate, you can compare the effects of market volatilities on Superior Plus and Swedbank Robur 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 Superior Plus with a short position of Swedbank Robur. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Swedbank Robur.

Diversification Opportunities for Superior Plus and Swedbank Robur

-0.1

Correlation Coefficient

Superior Plus  Swedbank Robur

Good diversification

The 3 months correlation between Superior and Swedbank is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Swedbank Robur Corporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swedbank Robur Corporate and Superior Plus 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 Superior Plus Corp are associated (or correlated) with Swedbank Robur. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swedbank Robur Corporate has no effect on the direction of Superior Plus i.e., Superior Plus and Swedbank Robur go up and down completely randomly.

Pair Corralation between Superior Plus and Swedbank Robur

Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the Swedbank Robur. In addition to that, Superior Plus is 14.25 times more volatile than Swedbank Robur Corporate. It trades about -0.01 of its total potential returns per unit of risk. Swedbank Robur Corporate is currently generating about 0.06 per unit of volatility. If you would invest  962.00  in Swedbank Robur Corporate on December 10, 2024 and sell it today you would earn a total of  13.00  from holding Swedbank Robur Corporate or generate 1.35% return on investment over 90 days.

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

Superior Plus Corp  vs.  Swedbank Robur Corporate

Superior Plus Corp

Risk-Adjusted Performance

Very Weak

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

Swedbank Robur Corporate

Risk-Adjusted Performance

Very Weak

Over the last 90 days Swedbank Robur Corporate has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy basic indicators, Swedbank Robur is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Superior Plus and Swedbank Robur

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

The idea behind Superior Plus Corp and Swedbank Robur Corporate 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.