Correlation Between Storytel and Boozt AB

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

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

Diversification Opportunities for Storytel and Boozt AB

0.18

Correlation Coefficient

Storytel  Boozt AB

Average diversification

The 3 months correlation between Storytel and Boozt is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Storytel AB and Boozt AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boozt AB and Storytel 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 Storytel AB are associated (or correlated) with Boozt AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boozt AB has no effect on the direction of Storytel i.e., Storytel and Boozt AB go up and down completely randomly.

Pair Corralation between Storytel and Boozt AB

Assuming the 90 days trading horizon Storytel AB is expected to generate 1.04 times more return on investment than Boozt AB. However, Storytel is 1.04 times more volatile than Boozt AB. It trades about 0.08 of its potential returns per unit of risk. Boozt AB is currently generating about 0.04 per unit of risk. If you would invest  5,730  in Storytel AB on October 22, 2024 and sell it today you would earn a total of  1,345  from holding Storytel AB or generate 23.47% return on investment over 90 days.

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

Storytel AB  vs.  Boozt AB

Storytel AB

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Storytel AB are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Storytel sustained solid returns over the last few months and may actually be approaching a breakup point.

Boozt AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Boozt AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Boozt AB is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Storytel and Boozt AB

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

The idea behind Storytel AB and Boozt 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.