Correlation Between Raketech Group and Awardit AB

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

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

Diversification Opportunities for Raketech Group and Awardit AB

-0.31

Correlation Coefficient

Raketech Group  Awardit AB

Very good diversification

The 3 months correlation between Raketech and Awardit is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Raketech Group Holding and Awardit AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Awardit AB and Raketech Group 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 Raketech Group Holding are associated (or correlated) with Awardit AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Awardit AB has no effect on the direction of Raketech Group i.e., Raketech Group and Awardit AB go up and down completely randomly.

Pair Corralation between Raketech Group and Awardit AB

Assuming the 90 days trading horizon Raketech Group Holding is expected to under-perform the Awardit AB. In addition to that, Raketech Group is 2.84 times more volatile than Awardit AB. It trades about -0.14 of its total potential returns per unit of risk. Awardit AB is currently generating about 0.0 per unit of volatility. If you would invest  13,000  in Awardit AB on September 12, 2024 and sell it today you would lose (50.00) from holding Awardit AB or give up 0.38% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	87.5%
Values	Daily Returns

Raketech Group Holding  vs.  Awardit AB

Raketech Group Holding

Risk-Adjusted Performance

0 of 100

Very Weak

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

Awardit AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Awardit AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Awardit 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 Raketech Group and Awardit AB

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

The idea behind Raketech Group Holding and Awardit 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.