Correlation Between COOR Service and Soder Sportfiske

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

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

Diversification Opportunities for COOR Service and Soder Sportfiske

-0.39

Correlation Coefficient

COOR Service  Soder Sportfiske

Very good diversification

The 3 months correlation between COOR and Soder is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding COOR Service Management and Soder Sportfiske AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soder Sportfiske and COOR Service 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 COOR Service Management are associated (or correlated) with Soder Sportfiske. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soder Sportfiske has no effect on the direction of COOR Service i.e., COOR Service and Soder Sportfiske go up and down completely randomly.

Pair Corralation between COOR Service and Soder Sportfiske

Assuming the 90 days trading horizon COOR Service Management is expected to under-perform the Soder Sportfiske. But the stock apears to be less risky and, when comparing its historical volatility, COOR Service Management is 1.81 times less risky than Soder Sportfiske. The stock trades about 0.0 of its potential returns per unit of risk. The Soder Sportfiske AB is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  2,480  in Soder Sportfiske AB on December 27, 2024 and sell it today you would earn a total of  600.00  from holding Soder Sportfiske AB or generate 24.19% return on investment over 90 days.

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

COOR Service Management  vs.  Soder Sportfiske AB

COOR Service Management

Risk-Adjusted Performance

Very Weak

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

Soder Sportfiske

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Soder Sportfiske AB are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Soder Sportfiske unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with COOR Service and Soder Sportfiske

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

The idea behind COOR Service Management and Soder Sportfiske 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..