Correlation Between Smart Eye and Generic Sweden
Can any of the company-specific risk be diversified away by investing in both Smart Eye 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 Smart Eye and Generic Sweden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smart Eye AB and Generic Sweden publ, you can compare the effects of market volatilities on Smart Eye 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 Smart Eye with a short position of Generic Sweden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart Eye and Generic Sweden.
Diversification Opportunities for Smart Eye and Generic Sweden
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Smart and Generic is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Smart Eye 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 Smart Eye 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 Smart Eye 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 Smart Eye i.e., Smart Eye and Generic Sweden go up and down completely randomly.
Pair Corralation between Smart Eye and Generic Sweden
Assuming the 90 days trading horizon Smart Eye AB is expected to generate 1.66 times more return on investment than Generic Sweden. However, Smart Eye is 1.66 times more volatile than Generic Sweden publ. It trades about 0.08 of its potential returns per unit of risk. Generic Sweden publ is currently generating about 0.0 per unit of risk. If you would invest 5,700 in Smart Eye AB on April 24, 2025 and sell it today you would earn a total of 760.00 from holding Smart Eye AB or generate 13.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
Smart Eye AB vs. Generic Sweden publ
Performance |
Timeline |
Smart Eye AB |
Generic Sweden publ |
Smart Eye and Generic Sweden Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Smart Eye and Generic Sweden
The main advantage of trading using opposite Smart Eye and Generic Sweden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smart Eye 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.Smart Eye vs. Qleanair Holding AB | Smart Eye vs. Media and Games | Smart Eye vs. Systemair AB | Smart Eye vs. Lea Bank AB |
Generic Sweden vs. FormPipe Software AB | Generic Sweden vs. Novotek AB | Generic Sweden vs. Hanza AB | Generic Sweden vs. Genovis AB |
Check out your portfolio center.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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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