Correlation Between Fenix Outdoor and Sdiptech

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

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

Diversification Opportunities for Fenix Outdoor and Sdiptech

-0.85

Correlation Coefficient

Fenix Outdoor  Sdiptech

Pay attention - limited upside

The 3 months correlation between Fenix and Sdiptech is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Fenix Outdoor International and Sdiptech AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sdiptech AB and Fenix Outdoor 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 Fenix Outdoor International are associated (or correlated) with Sdiptech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sdiptech AB has no effect on the direction of Fenix Outdoor i.e., Fenix Outdoor and Sdiptech go up and down completely randomly.

Pair Corralation between Fenix Outdoor and Sdiptech

Assuming the 90 days trading horizon Fenix Outdoor International is expected to under-perform the Sdiptech. But the stock apears to be less risky and, when comparing its historical volatility, Fenix Outdoor International is 1.13 times less risky than Sdiptech. The stock trades about -0.07 of its potential returns per unit of risk. The Sdiptech AB is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  10,627  in Sdiptech AB on April 21, 2025 and sell it today you would earn a total of  2,473  from holding Sdiptech AB or generate 23.27% return on investment over 90 days.

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

Fenix Outdoor International  vs.  Sdiptech AB

Fenix Outdoor Intern

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fenix Outdoor International 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.

Sdiptech AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sdiptech AB are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Sdiptech reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fenix Outdoor and Sdiptech

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

The idea behind Fenix Outdoor International and Sdiptech 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.