Correlation Between Fastighets and Dios Fastigheter

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

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

Diversification Opportunities for Fastighets and Dios Fastigheter

0.71

Correlation Coefficient

Fastighets  Dios Fastigheter

Poor diversification

The 3 months correlation between Fastighets and Dios is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Fastighets AB Balder and Dios Fastigheter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dios Fastigheter and Fastighets 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 Fastighets AB Balder are associated (or correlated) with Dios Fastigheter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dios Fastigheter has no effect on the direction of Fastighets i.e., Fastighets and Dios Fastigheter go up and down completely randomly.

Pair Corralation between Fastighets and Dios Fastigheter

Assuming the 90 days trading horizon Fastighets AB Balder is expected to generate 1.25 times more return on investment than Dios Fastigheter. However, Fastighets is 1.25 times more volatile than Dios Fastigheter AB. It trades about 0.03 of its potential returns per unit of risk. Dios Fastigheter AB is currently generating about 0.03 per unit of risk. If you would invest  6,788  in Fastighets AB Balder on April 24, 2025 and sell it today you would earn a total of  164.00  from holding Fastighets AB Balder or generate 2.42% return on investment over 90 days.

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

Fastighets AB Balder  vs.  Dios Fastigheter AB

Fastighets AB Balder

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fastighets AB Balder are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong essential indicators, Fastighets is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Dios Fastigheter

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Dios Fastigheter AB are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Dios Fastigheter is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Fastighets and Dios Fastigheter

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

The idea behind Fastighets AB Balder and Dios Fastigheter 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.