Correlation Between SaltX Technology and Idun Industrier
Can any of the company-specific risk be diversified away by investing in both SaltX Technology and Idun Industrier 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 SaltX Technology and Idun Industrier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SaltX Technology Holding and Idun Industrier AB, you can compare the effects of market volatilities on SaltX Technology and Idun Industrier 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 SaltX Technology with a short position of Idun Industrier. Check out your portfolio center. Please also check ongoing floating volatility patterns of SaltX Technology and Idun Industrier.
Diversification Opportunities for SaltX Technology and Idun Industrier
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SaltX and Idun is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding SaltX Technology Holding and Idun Industrier AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Idun Industrier AB and SaltX Technology 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 SaltX Technology Holding are associated (or correlated) with Idun Industrier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Idun Industrier AB has no effect on the direction of SaltX Technology i.e., SaltX Technology and Idun Industrier go up and down completely randomly.
Pair Corralation between SaltX Technology and Idun Industrier
Assuming the 90 days trading horizon SaltX Technology Holding is expected to generate 3.18 times more return on investment than Idun Industrier. However, SaltX Technology is 3.18 times more volatile than Idun Industrier AB. It trades about 0.13 of its potential returns per unit of risk. Idun Industrier AB is currently generating about 0.09 per unit of risk. If you would invest 324.00 in SaltX Technology Holding on December 30, 2024 and sell it today you would earn a total of 166.00 from holding SaltX Technology Holding or generate 51.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SaltX Technology Holding vs. Idun Industrier AB
Performance |
Timeline |
SaltX Technology Holding |
Idun Industrier AB |
SaltX Technology and Idun Industrier Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SaltX Technology and Idun Industrier
The main advantage of trading using opposite SaltX Technology and Idun Industrier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SaltX Technology position performs unexpectedly, Idun Industrier 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 Idun Industrier will offset losses from the drop in Idun Industrier's long position.SaltX Technology vs. GomSpace Group AB | SaltX Technology vs. Fingerprint Cards AB | SaltX Technology vs. Maha Energy AB | SaltX Technology vs. SolTech Energy Sweden |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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