Correlation Between Swedencare Publ and Stillfront Group

Can any of the company-specific risk be diversified away by investing in both Swedencare Publ and Stillfront Group 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 Stillfront Group 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 Stillfront Group AB, you can compare the effects of market volatilities on Swedencare Publ and Stillfront Group 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 Stillfront Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swedencare Publ and Stillfront Group.

Diversification Opportunities for Swedencare Publ and Stillfront Group

0.8

Correlation Coefficient

Swedencare Publ  Stillfront Group

Very poor diversification

The 3 months correlation between Swedencare and Stillfront is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Swedencare publ AB and Stillfront Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stillfront Group 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 Stillfront Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stillfront Group has no effect on the direction of Swedencare Publ i.e., Swedencare Publ and Stillfront Group go up and down completely randomly.

Pair Corralation between Swedencare Publ and Stillfront Group

Assuming the 90 days trading horizon Swedencare publ AB is expected to generate 0.76 times more return on investment than Stillfront Group. However, Swedencare publ AB is 1.31 times less risky than Stillfront Group. It trades about -0.14 of its potential returns per unit of risk. Stillfront Group AB is currently generating about -0.24 per unit of risk. If you would invest  4,854  in Swedencare publ AB on December 27, 2024 and sell it today you would lose (1,016) from holding Swedencare publ AB or give up 20.93% of portfolio value over 90 days.

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

Swedencare publ AB  vs.  Stillfront Group AB

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.

Stillfront Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stillfront Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Swedencare Publ and Stillfront Group

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

The idea behind Swedencare publ AB and Stillfront Group 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.