Correlation Between Senzime AB and SenzaGen

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

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

Diversification Opportunities for Senzime AB and SenzaGen

0.68

Correlation Coefficient

Senzime AB  SenzaGen

Poor diversification

The 3 months correlation between Senzime and SenzaGen is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Senzime AB and SenzaGen AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SenzaGen AB 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 SenzaGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SenzaGen AB has no effect on the direction of Senzime AB i.e., Senzime AB and SenzaGen go up and down completely randomly.

Pair Corralation between Senzime AB and SenzaGen

Assuming the 90 days trading horizon Senzime AB is expected to generate 0.96 times more return on investment than SenzaGen. However, Senzime AB is 1.04 times less risky than SenzaGen. It trades about -0.05 of its potential returns per unit of risk. SenzaGen AB is currently generating about -0.14 per unit of risk. If you would invest  550.00  in Senzime AB on December 29, 2024 and sell it today you would lose (60.00) from holding Senzime AB or give up 10.91% of portfolio value over 90 days.

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

Senzime AB  vs.  SenzaGen 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.

SenzaGen AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days SenzaGen 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 Senzime AB and SenzaGen

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

The idea behind Senzime AB and SenzaGen 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.