Correlation Between OssDsign and Rottneros

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

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

Diversification Opportunities for OssDsign and Rottneros

-0.81

Correlation Coefficient

OssDsign  Rottneros

Pay attention - limited upside

The 3 months correlation between OssDsign and Rottneros is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding OssDsign AB and Rottneros AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rottneros AB 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 Rottneros. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rottneros AB has no effect on the direction of OssDsign i.e., OssDsign and Rottneros go up and down completely randomly.

Pair Corralation between OssDsign and Rottneros

Assuming the 90 days trading horizon OssDsign AB is expected to generate 1.99 times more return on investment than Rottneros. However, OssDsign is 1.99 times more volatile than Rottneros AB. It trades about 0.02 of its potential returns per unit of risk. Rottneros AB is currently generating about -0.09 per unit of risk. If you would invest  975.00  in OssDsign AB on September 24, 2024 and sell it today you would earn a total of  20.00  from holding OssDsign AB or generate 2.05% return on investment over 90 days.

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

OssDsign AB  vs.  Rottneros 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.

Rottneros AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Rottneros AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with OssDsign and Rottneros

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

The idea behind OssDsign AB and Rottneros 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.

Check out your portfolio center.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.