Correlation Between Senzime AB and Bactiguard Holding

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

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

Diversification Opportunities for Senzime AB and Bactiguard Holding

0.32

Correlation Coefficient

Senzime AB  Bactiguard Holding

Weak diversification

The 3 months correlation between Senzime and Bactiguard is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Senzime AB and Bactiguard Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bactiguard Holding and Senzime AB 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 Senzime AB are associated (or correlated) with Bactiguard Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bactiguard Holding has no effect on the direction of Senzime AB i.e., Senzime AB and Bactiguard Holding go up and down completely randomly.

Pair Corralation between Senzime AB and Bactiguard Holding

Assuming the 90 days trading horizon Senzime AB is expected to generate 0.75 times more return on investment than Bactiguard Holding. However, Senzime AB is 1.34 times less risky than Bactiguard Holding. It trades about -0.04 of its potential returns per unit of risk. Bactiguard Holding AB is currently generating about -0.09 per unit of risk. If you would invest  565.00  in Senzime AB on December 26, 2024 and sell it today you would lose (50.00) from holding Senzime AB or give up 8.85% of portfolio value over 90 days.

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

Senzime AB  vs.  Bactiguard Holding AB

Senzime AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Senzime AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Bactiguard Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bactiguard Holding 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 basic 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.

Pair Trading with Senzime AB and Bactiguard Holding

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

The idea behind Senzime AB and Bactiguard Holding 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.