Correlation Between CAG Group and Exsitec Holding

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

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

Diversification Opportunities for CAG Group and Exsitec Holding

0.1

Correlation Coefficient

CAG Group  Exsitec Holding

Average diversification

The 3 months correlation between CAG and Exsitec is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding CAG Group AB and Exsitec Holding AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exsitec Holding AB and CAG 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 CAG Group AB are associated (or correlated) with Exsitec Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exsitec Holding AB has no effect on the direction of CAG Group i.e., CAG Group and Exsitec Holding go up and down completely randomly.

Pair Corralation between CAG Group and Exsitec Holding

Assuming the 90 days trading horizon CAG Group is expected to generate 1.69 times less return on investment than Exsitec Holding. But when comparing it to its historical volatility, CAG Group AB is 1.51 times less risky than Exsitec Holding. It trades about 0.1 of its potential returns per unit of risk. Exsitec Holding AB is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  12,150  in Exsitec Holding AB on May 1, 2025 and sell it today you would earn a total of  1,150  from holding Exsitec Holding AB or generate 9.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

CAG Group AB  vs.  Exsitec Holding AB

CAG Group AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CAG Group AB are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, CAG Group is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Exsitec Holding AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Exsitec Holding AB are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Exsitec Holding may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CAG Group and Exsitec Holding

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

The idea behind CAG Group AB and Exsitec Holding 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.

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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.