Correlation Between TRADEGATE and Diös Fastigheter

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

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

Diversification Opportunities for TRADEGATE and Diös Fastigheter

-0.12

Correlation Coefficient

TRADEGATE  Diös Fastigheter

Good diversification

The 3 months correlation between TRADEGATE and Diös is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding TRADEGATE and Dis Fastigheter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dis Fastigheter AB and TRADEGATE 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 TRADEGATE are associated (or correlated) with Diös Fastigheter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dis Fastigheter AB has no effect on the direction of TRADEGATE i.e., TRADEGATE and Diös Fastigheter go up and down completely randomly.

Pair Corralation between TRADEGATE and Diös Fastigheter

Assuming the 90 days trading horizon TRADEGATE is expected to generate 0.11 times more return on investment than Diös Fastigheter. However, TRADEGATE is 9.18 times less risky than Diös Fastigheter. It trades about 0.0 of its potential returns per unit of risk. Dis Fastigheter AB is currently generating about -0.08 per unit of risk. If you would invest  8,950  in TRADEGATE on October 11, 2024 and sell it today you would earn a total of  0.00  from holding TRADEGATE or generate 0.0% return on investment over 90 days.

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

TRADEGATE  vs.  Dis Fastigheter AB

TRADEGATE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days TRADEGATE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, TRADEGATE is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Dis Fastigheter AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dis Fastigheter AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with TRADEGATE and Diös Fastigheter

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

The idea behind TRADEGATE and Dis Fastigheter 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 Commodity Directory module to find actively traded commodities issued by global exchanges.