Correlation Between KlaraBo Sverige and Logistea A

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

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

Diversification Opportunities for KlaraBo Sverige and Logistea A

0.17

Correlation Coefficient

KlaraBo Sverige  Logistea A

Average diversification

The 3 months correlation between KlaraBo and Logistea is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding KlaraBo Sverige AB and Logistea A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logistea A and KlaraBo Sverige 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 KlaraBo Sverige AB are associated (or correlated) with Logistea A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logistea A has no effect on the direction of KlaraBo Sverige i.e., KlaraBo Sverige and Logistea A go up and down completely randomly.

Pair Corralation between KlaraBo Sverige and Logistea A

Assuming the 90 days trading horizon KlaraBo Sverige AB is expected to under-perform the Logistea A. But the stock apears to be less risky and, when comparing its historical volatility, KlaraBo Sverige AB is 1.01 times less risky than Logistea A. The stock trades about -0.1 of its potential returns per unit of risk. The Logistea A is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  1,535  in Logistea A on December 1, 2024 and sell it today you would lose (75.00) from holding Logistea A or give up 4.89% of portfolio value over 90 days.

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

KlaraBo Sverige AB  vs.  Logistea A

KlaraBo Sverige AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days KlaraBo Sverige AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Logistea A

Risk-Adjusted Performance

Very Weak

Over the last 90 days Logistea A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Logistea A is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with KlaraBo Sverige and Logistea A

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

The idea behind KlaraBo Sverige AB and Logistea A 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..