Correlation Between Acroud AB and Raketech Group

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

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

Diversification Opportunities for Acroud AB and Raketech Group

0.72

Correlation Coefficient

Acroud AB  Raketech Group

Poor diversification

The 3 months correlation between Acroud and Raketech is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Acroud AB and Raketech Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raketech Group Holding and Acroud 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 Acroud AB are associated (or correlated) with Raketech Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raketech Group Holding has no effect on the direction of Acroud AB i.e., Acroud AB and Raketech Group go up and down completely randomly.

Pair Corralation between Acroud AB and Raketech Group

Assuming the 90 days trading horizon Acroud AB is expected to under-perform the Raketech Group. In addition to that, Acroud AB is 1.17 times more volatile than Raketech Group Holding. It trades about -0.2 of its total potential returns per unit of risk. Raketech Group Holding is currently generating about -0.14 per unit of volatility. If you would invest  726.00  in Raketech Group Holding on September 12, 2024 and sell it today you would lose (279.00) from holding Raketech Group Holding or give up 38.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Acroud AB  vs.  Raketech Group Holding

Acroud AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acroud AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Raketech Group Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Raketech Group Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Acroud AB and Raketech Group

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

The idea behind Acroud AB and Raketech Group Holding 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .