Correlation Between Boozt AB and HusCompagniet

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

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

Diversification Opportunities for Boozt AB and HusCompagniet

-0.32

Correlation Coefficient

Boozt AB  HusCompagniet

Very good diversification

The 3 months correlation between Boozt and HusCompagniet is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Boozt AB and HusCompagniet AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HusCompagniet AS and Boozt 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 Boozt AB are associated (or correlated) with HusCompagniet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HusCompagniet AS has no effect on the direction of Boozt AB i.e., Boozt AB and HusCompagniet go up and down completely randomly.

Pair Corralation between Boozt AB and HusCompagniet

Assuming the 90 days trading horizon Boozt AB is expected to generate 1.1 times more return on investment than HusCompagniet. However, Boozt AB is 1.1 times more volatile than HusCompagniet AS. It trades about 0.09 of its potential returns per unit of risk. HusCompagniet AS is currently generating about -0.08 per unit of risk. If you would invest  7,400  in Boozt AB on December 1, 2024 and sell it today you would earn a total of  715.00  from holding Boozt AB or generate 9.66% return on investment over 90 days.

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

Boozt AB  vs.  HusCompagniet AS

Boozt AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Boozt AB are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Boozt AB may actually be approaching a critical reversion point that can send shares even higher in April 2025.

HusCompagniet AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days HusCompagniet AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Boozt AB and HusCompagniet

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

The idea behind Boozt AB and HusCompagniet AS 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.