Correlation Between OssDsign and Bonesupport Holding

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

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

Diversification Opportunities for OssDsign and Bonesupport Holding

0.68

Correlation Coefficient

OssDsign  Bonesupport Holding

Poor diversification

The 3 months correlation between OssDsign and Bonesupport is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding OssDsign AB and Bonesupport Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonesupport Holding and OssDsign 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 OssDsign AB are associated (or correlated) with Bonesupport Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonesupport Holding has no effect on the direction of OssDsign i.e., OssDsign and Bonesupport Holding go up and down completely randomly.

Pair Corralation between OssDsign and Bonesupport Holding

Assuming the 90 days trading horizon OssDsign AB is expected to generate 1.26 times more return on investment than Bonesupport Holding. However, OssDsign is 1.26 times more volatile than Bonesupport Holding AB. It trades about 0.2 of its potential returns per unit of risk. Bonesupport Holding AB is currently generating about 0.13 per unit of risk. If you would invest  682.00  in OssDsign AB on September 23, 2024 and sell it today you would earn a total of  313.00  from holding OssDsign AB or generate 45.89% return on investment over 90 days.

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

OssDsign AB  vs.  Bonesupport Holding AB

OssDsign AB

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in OssDsign AB are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, OssDsign unveiled solid returns over the last few months and may actually be approaching a breakup point.

Bonesupport Holding

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bonesupport Holding AB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Bonesupport Holding unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with OssDsign and Bonesupport Holding

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

The idea behind OssDsign AB and Bonesupport Holding 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.