Correlation Between Vitec Software and Fortnox AB

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

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

Diversification Opportunities for Vitec Software and Fortnox AB

-0.19

Correlation Coefficient

Vitec Software  Fortnox AB

Good diversification

The 3 months correlation between Vitec and Fortnox is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Vitec Software Group and Fortnox AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fortnox AB and Vitec Software 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 Vitec Software Group are associated (or correlated) with Fortnox AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fortnox AB has no effect on the direction of Vitec Software i.e., Vitec Software and Fortnox AB go up and down completely randomly.

Pair Corralation between Vitec Software and Fortnox AB

Assuming the 90 days trading horizon Vitec Software Group is expected to under-perform the Fortnox AB. In addition to that, Vitec Software is 3.91 times more volatile than Fortnox AB. It trades about -0.09 of its total potential returns per unit of risk. Fortnox AB is currently generating about 0.04 per unit of volatility. If you would invest  8,650  in Fortnox AB on April 25, 2025 and sell it today you would earn a total of  156.00  from holding Fortnox AB or generate 1.8% return on investment over 90 days.

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

Vitec Software Group  vs.  Fortnox AB

Vitec Software Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vitec Software Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Fortnox AB

Risk-Adjusted Performance

Weak

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

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

The idea behind Vitec Software Group and Fortnox 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.