Correlation Between Generic Sweden and Opter AB

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

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

Diversification Opportunities for Generic Sweden and Opter AB

-0.45

Correlation Coefficient

Generic Sweden  Opter AB

Very good diversification

The 3 months correlation between Generic and Opter is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Generic Sweden publ and Opter AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Opter AB and Generic Sweden 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 Generic Sweden publ are associated (or correlated) with Opter AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Opter AB has no effect on the direction of Generic Sweden i.e., Generic Sweden and Opter AB go up and down completely randomly.

Pair Corralation between Generic Sweden and Opter AB

Assuming the 90 days trading horizon Generic Sweden is expected to generate 4.81 times less return on investment than Opter AB. In addition to that, Generic Sweden is 1.35 times more volatile than Opter AB. It trades about 0.01 of its total potential returns per unit of risk. Opter AB is currently generating about 0.04 per unit of volatility. If you would invest  10,656  in Opter AB on April 23, 2025 and sell it today you would earn a total of  344.00  from holding Opter AB or generate 3.23% return on investment over 90 days.

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

Generic Sweden publ  vs.  Opter AB

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.

Opter AB

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Opter AB are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Opter AB 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 Generic Sweden and Opter AB

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

The idea behind Generic Sweden publ and Opter 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.