Correlation Between Vincit Group and LeadDesk Oyj

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

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

Diversification Opportunities for Vincit Group and LeadDesk Oyj

0.18

Correlation Coefficient

Vincit Group  LeadDesk Oyj

Average diversification

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

Pair Corralation between Vincit Group and LeadDesk Oyj

Assuming the 90 days trading horizon Vincit Group Oyj is expected to generate 1.43 times more return on investment than LeadDesk Oyj. However, Vincit Group is 1.43 times more volatile than LeadDesk Oyj. It trades about 0.06 of its potential returns per unit of risk. LeadDesk Oyj is currently generating about 0.06 per unit of risk. If you would invest  176.00  in Vincit Group Oyj on December 24, 2024 and sell it today you would earn a total of  15.00  from holding Vincit Group Oyj or generate 8.52% return on investment over 90 days.

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

Vincit Group Oyj  vs.  LeadDesk Oyj

Vincit Group Oyj

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vincit Group Oyj are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat inconsistent basic indicators, Vincit Group may actually be approaching a critical reversion point that can send shares even higher in April 2025.

LeadDesk Oyj

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LeadDesk Oyj are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, LeadDesk Oyj may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Vincit Group and LeadDesk Oyj

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

The idea behind Vincit Group Oyj and LeadDesk Oyj 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.

Check out your portfolio center.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.