Correlation Between Swedencare Publ and Integrum

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

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

Diversification Opportunities for Swedencare Publ and Integrum

0.7

Correlation Coefficient

Swedencare Publ  Integrum

Poor diversification

The 3 months correlation between Swedencare and Integrum is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Swedencare publ AB and Integrum AB Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrum AB Series and Swedencare Publ 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 Swedencare publ AB are associated (or correlated) with Integrum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrum AB Series has no effect on the direction of Swedencare Publ i.e., Swedencare Publ and Integrum go up and down completely randomly.

Pair Corralation between Swedencare Publ and Integrum

Assuming the 90 days trading horizon Swedencare publ AB is expected to under-perform the Integrum. But the stock apears to be less risky and, when comparing its historical volatility, Swedencare publ AB is 1.0 times less risky than Integrum. The stock trades about -0.13 of its potential returns per unit of risk. The Integrum AB Series is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  1,835  in Integrum AB Series on December 27, 2024 and sell it today you would lose (150.00) from holding Integrum AB Series or give up 8.17% of portfolio value over 90 days.

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

Swedencare publ AB  vs.  Integrum AB Series

Swedencare publ AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Swedencare publ AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Integrum AB Series

Risk-Adjusted Performance

Very Weak

Over the last 90 days Integrum AB Series has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Swedencare Publ and Integrum

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

The idea behind Swedencare publ AB and Integrum AB Series 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.