Correlation Between Checkin Group and Generic Sweden

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

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

Diversification Opportunities for Checkin Group and Generic Sweden

0.33

Correlation Coefficient

Checkin Group  Generic Sweden

Weak diversification

The 3 months correlation between Checkin and Generic is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Checkin Group AB and Generic Sweden publ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Generic Sweden publ and Checkin 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 Checkin Group AB are associated (or correlated) with Generic Sweden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Generic Sweden publ has no effect on the direction of Checkin Group i.e., Checkin Group and Generic Sweden go up and down completely randomly.

Pair Corralation between Checkin Group and Generic Sweden

Assuming the 90 days trading horizon Checkin Group AB is expected to under-perform the Generic Sweden. In addition to that, Checkin Group is 2.07 times more volatile than Generic Sweden publ. It trades about -0.05 of its total potential returns per unit of risk. Generic Sweden publ is currently generating about 0.01 per unit of volatility. If you would invest  5,600  in Generic Sweden publ on April 23, 2025 and sell it today you would lose (20.00) from holding Generic Sweden publ or give up 0.36% of portfolio value over 90 days.

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

Checkin Group AB  vs.  Generic Sweden publ

Checkin Group AB

Risk-Adjusted Performance

Very Weak

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

Generic Sweden publ

Risk-Adjusted Performance

Very Weak

Over the last 90 days Generic Sweden publ has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Generic Sweden 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 Checkin Group and Generic Sweden

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

The idea behind Checkin Group AB and Generic Sweden publ 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.