Correlation Between Moberg Pharma and Swedencare Publ

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

By analyzing existing cross correlation between Moberg Pharma AB and Swedencare publ AB, you can compare the effects of market volatilities on Moberg Pharma and Swedencare Publ 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 Moberg Pharma with a short position of Swedencare Publ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moberg Pharma and Swedencare Publ.

Diversification Opportunities for Moberg Pharma and Swedencare Publ

0.36

Correlation Coefficient

Moberg Pharma  Swedencare Publ

Weak diversification

The 3 months correlation between Moberg and Swedencare is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Moberg Pharma AB and Swedencare publ AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swedencare publ AB and Moberg Pharma 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 Moberg Pharma AB are associated (or correlated) with Swedencare Publ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swedencare publ AB has no effect on the direction of Moberg Pharma i.e., Moberg Pharma and Swedencare Publ go up and down completely randomly.

Pair Corralation between Moberg Pharma and Swedencare Publ

Assuming the 90 days trading horizon Moberg Pharma AB is expected to under-perform the Swedencare Publ. In addition to that, Moberg Pharma is 2.78 times more volatile than Swedencare publ AB. It trades about -0.11 of its total potential returns per unit of risk. Swedencare publ AB is currently generating about -0.09 per unit of volatility. If you would invest  4,890  in Swedencare publ AB on December 2, 2024 and sell it today you would lose (640.00) from holding Swedencare publ AB or give up 13.09% of portfolio value over 90 days.

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

Moberg Pharma AB  vs.  Swedencare publ AB

Moberg Pharma AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moberg Pharma 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 fundamental drivers remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Swedencare publ AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Swedencare publ 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 fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Moberg Pharma and Swedencare Publ

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

The idea behind Moberg Pharma AB and Swedencare publ 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.