Correlation Between Synsam AB and Ortivus AB

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

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

Diversification Opportunities for Synsam AB and Ortivus AB

-0.58

Correlation Coefficient

Synsam AB  Ortivus AB

Excellent diversification

The 3 months correlation between Synsam and Ortivus is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Synsam AB and Ortivus AB ser in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ortivus AB ser and Synsam AB 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 Synsam AB are associated (or correlated) with Ortivus AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ortivus AB ser has no effect on the direction of Synsam AB i.e., Synsam AB and Ortivus AB go up and down completely randomly.

Pair Corralation between Synsam AB and Ortivus AB

Assuming the 90 days trading horizon Synsam AB is expected to generate 0.99 times more return on investment than Ortivus AB. However, Synsam AB is 1.01 times less risky than Ortivus AB. It trades about -0.21 of its potential returns per unit of risk. Ortivus AB ser is currently generating about -0.22 per unit of risk. If you would invest  5,790  in Synsam AB on January 30, 2024 and sell it today you would lose (520.00) from holding Synsam AB or give up 8.98% of portfolio value over 90 days.

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

Synsam AB  vs.  Ortivus AB ser

Synsam AB

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Synsam AB are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Synsam AB sustained solid returns over the last few months and may actually be approaching a breakup point.

Ortivus AB ser

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ortivus AB ser 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 basic indicators remain somewhat strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Synsam AB and Ortivus AB

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

The idea behind Synsam AB and Ortivus AB ser 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..