Correlation Between Tryg AS and MapsPeople

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

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

Diversification Opportunities for Tryg AS and MapsPeople

0.41

Correlation Coefficient

Tryg AS  MapsPeople

Very weak diversification

The 3 months correlation between Tryg and MapsPeople is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Tryg AS and MapsPeople AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MapsPeople AS and Tryg AS 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 Tryg AS are associated (or correlated) with MapsPeople. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MapsPeople AS has no effect on the direction of Tryg AS i.e., Tryg AS and MapsPeople go up and down completely randomly.

Pair Corralation between Tryg AS and MapsPeople

Assuming the 90 days trading horizon Tryg AS is expected to generate 1.63 times less return on investment than MapsPeople. But when comparing it to its historical volatility, Tryg AS is 8.17 times less risky than MapsPeople. It trades about 0.04 of its potential returns per unit of risk. MapsPeople AS is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  376.00  in MapsPeople AS on December 1, 2024 and sell it today you would lose (286.00) from holding MapsPeople AS or give up 76.06% of portfolio value over 90 days.

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

Tryg AS  vs.  MapsPeople AS

Tryg AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tryg AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Tryg AS is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

MapsPeople AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days MapsPeople AS 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 very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Tryg AS and MapsPeople

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

The idea behind Tryg AS and MapsPeople AS 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..