Correlation Between NP3 Fastigheter and SBB-D

Can any of the company-specific risk be diversified away by investing in both NP3 Fastigheter and SBB-D 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 NP3 Fastigheter and SBB-D into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NP3 Fastigheter AB and Samhaellsbyggnadsbolaget i Norden, you can compare the effects of market volatilities on NP3 Fastigheter and SBB-D 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 NP3 Fastigheter with a short position of SBB-D. Check out your portfolio center. Please also check ongoing floating volatility patterns of NP3 Fastigheter and SBB-D.

Diversification Opportunities for NP3 Fastigheter and SBB-D

0.18

Correlation Coefficient

NP3 Fastigheter  SBB-D

Average diversification

The 3 months correlation between NP3 and SBB-D is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding NP3 Fastigheter AB and Samhaellsbyggnadsbolaget i Nor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhaellsbyggnadsbol and NP3 Fastigheter 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 NP3 Fastigheter AB are associated (or correlated) with SBB-D. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhaellsbyggnadsbol has no effect on the direction of NP3 Fastigheter i.e., NP3 Fastigheter and SBB-D go up and down completely randomly.

Pair Corralation between NP3 Fastigheter and SBB-D

Assuming the 90 days trading horizon NP3 Fastigheter is expected to generate 3.78 times less return on investment than SBB-D. But when comparing it to its historical volatility, NP3 Fastigheter AB is 2.76 times less risky than SBB-D. It trades about 0.07 of its potential returns per unit of risk. Samhaellsbyggnadsbolaget i Norden is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  649.00  in Samhaellsbyggnadsbolaget i Norden on May 6, 2025 and sell it today you would earn a total of  152.00  from holding Samhaellsbyggnadsbolaget i Norden or generate 23.42% return on investment over 90 days.

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

NP3 Fastigheter AB  vs.  Samhaellsbyggnadsbolaget i Nor

NP3 Fastigheter AB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in NP3 Fastigheter AB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, NP3 Fastigheter may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Samhaellsbyggnadsbol

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Samhaellsbyggnadsbolaget i Norden are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SBB-D unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NP3 Fastigheter and SBB-D

The main advantage of trading using opposite NP3 Fastigheter and SBB-D positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NP3 Fastigheter position performs unexpectedly, SBB-D 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 SBB-D will offset losses from the drop in SBB-D's long position.

The idea behind NP3 Fastigheter AB and Samhaellsbyggnadsbolaget i Norden 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.