Correlation Between Small Cap and SEALSQ Corp

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

By analyzing existing cross correlation between Small Cap Premium and SEALSQ Corp Ordinary, you can compare the effects of market volatilities on Small Cap and SEALSQ Corp 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 Small Cap with a short position of SEALSQ Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Cap and SEALSQ Corp.

Diversification Opportunities for Small Cap and SEALSQ Corp

0.0

Correlation Coefficient

Small Cap  SEALSQ Corp

Pay attention - limited upside

The 3 months correlation between Small and SEALSQ is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Premium and SEALSQ Corp Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEALSQ Corp Ordinary and Small Cap 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 Small Cap Premium are associated (or correlated) with SEALSQ Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEALSQ Corp Ordinary has no effect on the direction of Small Cap i.e., Small Cap and SEALSQ Corp go up and down completely randomly.

Pair Corralation between Small Cap and SEALSQ Corp

If you would invest  2,456  in Small Cap Premium on September 22, 2024 and sell it today you would earn a total of  8.00  from holding Small Cap Premium or generate 0.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Small Cap Premium  vs.  SEALSQ Corp Ordinary

Small Cap Premium

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Small Cap Premium are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Small Cap is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

SEALSQ Corp Ordinary

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SEALSQ Corp Ordinary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, SEALSQ Corp is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Small Cap and SEALSQ Corp

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

The idea behind Small Cap Premium and SEALSQ Corp Ordinary 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.