Correlation Between Smart Eye and AroCell AB
Can any of the company-specific risk be diversified away by investing in both Smart Eye and AroCell AB 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 Smart Eye and AroCell AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart Eye AB and AroCell AB, you can compare the effects of market volatilities on Smart Eye and AroCell AB 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 Smart Eye with a short position of AroCell AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart Eye and AroCell AB.
Diversification Opportunities for Smart Eye and AroCell AB
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Smart and AroCell is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Smart Eye AB and AroCell AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AroCell AB and Smart Eye 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 Smart Eye AB are associated (or correlated) with AroCell AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AroCell AB has no effect on the direction of Smart Eye i.e., Smart Eye and AroCell AB go up and down completely randomly.
Pair Corralation between Smart Eye and AroCell AB
Assuming the 90 days trading horizon Smart Eye AB is expected to under-perform the AroCell AB. In addition to that, Smart Eye is 1.08 times more volatile than AroCell AB. It trades about -0.07 of its total potential returns per unit of risk. AroCell AB is currently generating about 0.15 per unit of volatility. If you would invest 39.00 in AroCell AB on December 30, 2024 and sell it today you would earn a total of 15.00 from holding AroCell AB or generate 38.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Smart Eye AB vs. AroCell AB
Performance |
Timeline |
Smart Eye AB |
AroCell AB |
Smart Eye and AroCell AB Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Smart Eye and AroCell AB
The main advantage of trading using opposite Smart Eye and AroCell AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart Eye position performs unexpectedly, AroCell AB 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 AroCell AB will offset losses from the drop in AroCell AB's long position.Smart Eye vs. OptiCept Technologies AB | Smart Eye vs. Vitec Software Group | Smart Eye vs. Active Biotech AB | Smart Eye vs. Raketech Group Holding |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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