Correlation Between ALM Equity and Cibus Nordic

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

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

Diversification Opportunities for ALM Equity and Cibus Nordic

-0.44

Correlation Coefficient

ALM Equity  Cibus Nordic

Very good diversification

The 3 months correlation between ALM and Cibus is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding ALM Equity AB and Cibus Nordic Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cibus Nordic Real and ALM Equity 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 ALM Equity AB are associated (or correlated) with Cibus Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cibus Nordic Real has no effect on the direction of ALM Equity i.e., ALM Equity and Cibus Nordic go up and down completely randomly.

Pair Corralation between ALM Equity and Cibus Nordic

Assuming the 90 days trading horizon ALM Equity AB is expected to under-perform the Cibus Nordic. In addition to that, ALM Equity is 2.28 times more volatile than Cibus Nordic Real. It trades about -0.06 of its total potential returns per unit of risk. Cibus Nordic Real is currently generating about 0.2 per unit of volatility. If you would invest  15,890  in Cibus Nordic Real on April 20, 2025 and sell it today you would earn a total of  2,255  from holding Cibus Nordic Real or generate 14.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

ALM Equity AB  vs.  Cibus Nordic Real

ALM Equity AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALM Equity AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's primary indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Cibus Nordic Real

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cibus Nordic Real are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Cibus Nordic unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ALM Equity and Cibus Nordic

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

The idea behind ALM Equity AB and Cibus Nordic Real 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.