Correlation Between Organoclick and Saxlund Group

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

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

Diversification Opportunities for Organoclick and Saxlund Group

-0.22

Correlation Coefficient

Organoclick  Saxlund Group

Very good diversification

The 3 months correlation between Organoclick and Saxlund is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Organoclick AB and Saxlund Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saxlund Group AB and Organoclick 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 Organoclick AB are associated (or correlated) with Saxlund Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saxlund Group AB has no effect on the direction of Organoclick i.e., Organoclick and Saxlund Group go up and down completely randomly.

Pair Corralation between Organoclick and Saxlund Group

Assuming the 90 days trading horizon Organoclick AB is expected to generate 0.47 times more return on investment than Saxlund Group. However, Organoclick AB is 2.13 times less risky than Saxlund Group. It trades about 0.0 of its potential returns per unit of risk. Saxlund Group AB is currently generating about -0.09 per unit of risk. If you would invest  324.00  in Organoclick AB on October 5, 2024 and sell it today you would lose (31.00) from holding Organoclick AB or give up 9.57% of portfolio value over 90 days.

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

Organoclick AB  vs.  Saxlund Group AB

Organoclick AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Organoclick AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Organoclick is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Saxlund Group AB

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Saxlund Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively weak basic indicators, Saxlund Group may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Organoclick and Saxlund Group

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

The idea behind Organoclick AB and Saxlund Group 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.