Correlation Between Investor and Spectrumone Publ

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

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

Diversification Opportunities for Investor and Spectrumone Publ

-0.39

Correlation Coefficient

Investor  Spectrumone Publ

Very good diversification

The 3 months correlation between Investor and Spectrumone is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Investor AB ser and Spectrumone publ AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectrumone publ and Investor 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 Investor AB ser are associated (or correlated) with Spectrumone Publ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectrumone publ has no effect on the direction of Investor i.e., Investor and Spectrumone Publ go up and down completely randomly.

Pair Corralation between Investor and Spectrumone Publ

Assuming the 90 days trading horizon Investor AB ser is expected to generate 0.24 times more return on investment than Spectrumone Publ. However, Investor AB ser is 4.14 times less risky than Spectrumone Publ. It trades about 0.04 of its potential returns per unit of risk. Spectrumone publ AB is currently generating about -0.02 per unit of risk. If you would invest  27,888  in Investor AB ser on April 24, 2025 and sell it today you would earn a total of  762.00  from holding Investor AB ser or generate 2.73% return on investment over 90 days.

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

Investor AB ser  vs.  Spectrumone publ AB

Investor AB ser

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Investor AB ser are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Investor is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Spectrumone publ

Risk-Adjusted Performance

Very Weak

Over the last 90 days Spectrumone publ AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Spectrumone Publ is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Investor and Spectrumone Publ

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

The idea behind Investor AB ser and Spectrumone publ 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 Transaction History module to view history of all your transactions and understand their impact on performance.