Correlation Between Instalco Intressenter and Allfunds

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

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

Diversification Opportunities for Instalco Intressenter and Allfunds

-0.45

Correlation Coefficient

Instalco Intressenter  Allfunds

Very good diversification

The 3 months correlation between Instalco and Allfunds is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Instalco Intressenter AB and Allfunds Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allfunds Group and Instalco Intressenter 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 Instalco Intressenter AB are associated (or correlated) with Allfunds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allfunds Group has no effect on the direction of Instalco Intressenter i.e., Instalco Intressenter and Allfunds go up and down completely randomly.

Pair Corralation between Instalco Intressenter and Allfunds

Assuming the 90 days trading horizon Instalco Intressenter AB is expected to under-perform the Allfunds. In addition to that, Instalco Intressenter is 1.23 times more volatile than Allfunds Group. It trades about -0.18 of its total potential returns per unit of risk. Allfunds Group is currently generating about 0.02 per unit of volatility. If you would invest  526.00  in Allfunds Group on September 14, 2024 and sell it today you would earn a total of  7.00  from holding Allfunds Group or generate 1.33% return on investment over 90 days.

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

Instalco Intressenter AB  vs.  Allfunds Group

Instalco Intressenter

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Instalco Intressenter 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.

Allfunds Group

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Allfunds Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Allfunds is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Instalco Intressenter and Allfunds

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

The idea behind Instalco Intressenter AB and Allfunds Group 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.