Correlation Between Xvivo Perfusion and Sectra AB

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

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

Diversification Opportunities for Xvivo Perfusion and Sectra AB

-0.3

Correlation Coefficient

Xvivo Perfusion  Sectra AB

Very good diversification

The 3 months correlation between Xvivo and Sectra is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Xvivo Perfusion AB and Sectra AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sectra AB and Xvivo Perfusion 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 Xvivo Perfusion AB are associated (or correlated) with Sectra AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sectra AB has no effect on the direction of Xvivo Perfusion i.e., Xvivo Perfusion and Sectra AB go up and down completely randomly.

Pair Corralation between Xvivo Perfusion and Sectra AB

Assuming the 90 days trading horizon Xvivo Perfusion is expected to generate 1.14 times less return on investment than Sectra AB. In addition to that, Xvivo Perfusion is 1.66 times more volatile than Sectra AB. It trades about 0.09 of its total potential returns per unit of risk. Sectra AB is currently generating about 0.17 per unit of volatility. If you would invest  14,330  in Sectra AB on September 4, 2024 and sell it today you would earn a total of  14,715  from holding Sectra AB or generate 102.69% return on investment over 90 days.

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

Xvivo Perfusion AB  vs.  Sectra AB

Xvivo Perfusion AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xvivo Perfusion AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Xvivo Perfusion is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Sectra AB

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sectra AB are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental indicators, Sectra AB sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Xvivo Perfusion and Sectra AB

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

The idea behind Xvivo Perfusion AB and Sectra 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.