Correlation Between Triboron International and Clinical Laserthermia

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

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

Diversification Opportunities for Triboron International and Clinical Laserthermia

0.59

Correlation Coefficient

Triboron International  Clinical Laserthermia

Very weak diversification

The 3 months correlation between Triboron and Clinical is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Triboron International AB and Clinical Laserthermia Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clinical Laserthermia and Triboron International 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 Triboron International AB are associated (or correlated) with Clinical Laserthermia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clinical Laserthermia has no effect on the direction of Triboron International i.e., Triboron International and Clinical Laserthermia go up and down completely randomly.

Pair Corralation between Triboron International and Clinical Laserthermia

Assuming the 90 days trading horizon Triboron International AB is expected to under-perform the Clinical Laserthermia. In addition to that, Triboron International is 1.21 times more volatile than Clinical Laserthermia Systems. It trades about -0.07 of its total potential returns per unit of risk. Clinical Laserthermia Systems is currently generating about -0.03 per unit of volatility. If you would invest  416.00  in Clinical Laserthermia Systems on December 2, 2024 and sell it today you would lose (50.00) from holding Clinical Laserthermia Systems or give up 12.02% of portfolio value over 90 days.

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

Triboron International AB  vs.  Clinical Laserthermia Systems

Triboron International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Triboron International 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 fundamental drivers 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.

Clinical Laserthermia

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Triboron International and Clinical Laserthermia

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

The idea behind Triboron International AB and Clinical Laserthermia Systems 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.