Correlation Between Goodbye Kansas and AVTECH Sweden

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

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

Diversification Opportunities for Goodbye Kansas and AVTECH Sweden

-0.47

Correlation Coefficient

Goodbye Kansas  AVTECH Sweden

Very good diversification

The 3 months correlation between Goodbye and AVTECH is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Goodbye Kansas Group and AVTECH Sweden AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVTECH Sweden AB and Goodbye Kansas 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 Goodbye Kansas Group are associated (or correlated) with AVTECH Sweden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVTECH Sweden AB has no effect on the direction of Goodbye Kansas i.e., Goodbye Kansas and AVTECH Sweden go up and down completely randomly.

Pair Corralation between Goodbye Kansas and AVTECH Sweden

Assuming the 90 days trading horizon Goodbye Kansas is expected to generate 1.73 times less return on investment than AVTECH Sweden. In addition to that, Goodbye Kansas is 1.16 times more volatile than AVTECH Sweden AB. It trades about 0.03 of its total potential returns per unit of risk. AVTECH Sweden AB is currently generating about 0.06 per unit of volatility. If you would invest  390.00  in AVTECH Sweden AB on September 16, 2024 and sell it today you would earn a total of  13.00  from holding AVTECH Sweden AB or generate 3.33% return on investment over 90 days.

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

Goodbye Kansas Group  vs.  AVTECH Sweden AB

Goodbye Kansas Group

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Goodbye Kansas Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, Goodbye Kansas unveiled solid returns over the last few months and may actually be approaching a breakup point.

AVTECH Sweden AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AVTECH Sweden AB 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 Goodbye Kansas and AVTECH Sweden

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

The idea behind Goodbye Kansas Group and AVTECH Sweden 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 Global Correlations module to find global opportunities by holding instruments from different markets.