Correlation Between Smart Eye and Sivers IMA

Can any of the company-specific risk be diversified away by investing in both Smart Eye and Sivers IMA 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 Sivers IMA 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 Sivers IMA Holding, you can compare the effects of market volatilities on Smart Eye and Sivers IMA 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 Sivers IMA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smart Eye and Sivers IMA.

Diversification Opportunities for Smart Eye and Sivers IMA

0.41

Correlation Coefficient

Smart Eye  Sivers IMA

Very weak diversification

The 3 months correlation between Smart and Sivers is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Smart Eye AB and Sivers IMA Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sivers IMA Holding 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 Sivers IMA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sivers IMA Holding has no effect on the direction of Smart Eye i.e., Smart Eye and Sivers IMA go up and down completely randomly.

Pair Corralation between Smart Eye and Sivers IMA

Assuming the 90 days trading horizon Smart Eye is expected to generate 1.12 times less return on investment than Sivers IMA. But when comparing it to its historical volatility, Smart Eye AB is 1.32 times less risky than Sivers IMA. It trades about 0.08 of its potential returns per unit of risk. Sivers IMA Holding is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  344.00  in Sivers IMA Holding on April 24, 2025 and sell it today you would earn a total of  44.00  from holding Sivers IMA Holding or generate 12.79% return on investment over 90 days.

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

Smart Eye AB  vs.  Sivers IMA Holding

Smart Eye AB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Smart Eye AB are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Smart Eye unveiled solid returns over the last few months and may actually be approaching a breakup point.

Sivers IMA Holding

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sivers IMA Holding are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Sivers IMA unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Smart Eye and Sivers IMA

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

The idea behind Smart Eye AB and Sivers IMA Holding 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.