Correlation Between Systemair and Creades AB

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

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

Diversification Opportunities for Systemair and Creades AB

-0.45

Correlation Coefficient

Systemair  Creades AB

Very good diversification

The 3 months correlation between Systemair and Creades is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Systemair AB and Creades AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creades AB and Systemair 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 Systemair AB are associated (or correlated) with Creades AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creades AB has no effect on the direction of Systemair i.e., Systemair and Creades AB go up and down completely randomly.

Pair Corralation between Systemair and Creades AB

Assuming the 90 days trading horizon Systemair AB is expected to under-perform the Creades AB. In addition to that, Systemair is 1.02 times more volatile than Creades AB. It trades about -0.1 of its total potential returns per unit of risk. Creades AB is currently generating about 0.12 per unit of volatility. If you would invest  7,163  in Creades AB on December 24, 2024 and sell it today you would earn a total of  972.00  from holding Creades AB or generate 13.57% return on investment over 90 days.

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

Systemair AB  vs.  Creades AB

Systemair AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Systemair AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain 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.

Creades AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Creades AB are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Creades AB sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Systemair and Creades AB

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

The idea behind Systemair AB and Creades 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..