Correlation Between Instalco Intressenter and Crunchfish

Can any of the company-specific risk be diversified away by investing in both Instalco Intressenter and Crunchfish 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 Crunchfish 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 Crunchfish AB, you can compare the effects of market volatilities on Instalco Intressenter and Crunchfish 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 Crunchfish. Check out your portfolio center. Please also check ongoing floating volatility patterns of Instalco Intressenter and Crunchfish.

Diversification Opportunities for Instalco Intressenter and Crunchfish

0.8

Correlation Coefficient

Instalco Intressenter  Crunchfish

Very poor diversification

The 3 months correlation between Instalco and Crunchfish is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Instalco Intressenter AB and Crunchfish AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crunchfish AB 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 Crunchfish. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crunchfish AB has no effect on the direction of Instalco Intressenter i.e., Instalco Intressenter and Crunchfish go up and down completely randomly.

Pair Corralation between Instalco Intressenter and Crunchfish

Assuming the 90 days trading horizon Instalco Intressenter AB is expected to generate 0.17 times more return on investment than Crunchfish. However, Instalco Intressenter AB is 5.82 times less risky than Crunchfish. It trades about 0.13 of its potential returns per unit of risk. Crunchfish AB is currently generating about 0.02 per unit of risk. If you would invest  3,120  in Instalco Intressenter AB on September 27, 2024 and sell it today you would earn a total of  152.00  from holding Instalco Intressenter AB or generate 4.87% return on investment over 90 days.

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

Instalco Intressenter AB  vs.  Crunchfish AB

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.

Crunchfish AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Crunchfish AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak 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 Instalco Intressenter and Crunchfish

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

The idea behind Instalco Intressenter AB and Crunchfish 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..