Correlation Between Stillfront Group and Clemondo Group

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

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

Diversification Opportunities for Stillfront Group and Clemondo Group

-0.56

Correlation Coefficient

Stillfront Group  Clemondo Group

Excellent diversification

The 3 months correlation between Stillfront and Clemondo is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Stillfront Group AB and Clemondo Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clemondo Group AB and Stillfront 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 Stillfront Group AB are associated (or correlated) with Clemondo Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clemondo Group AB has no effect on the direction of Stillfront Group i.e., Stillfront Group and Clemondo Group go up and down completely randomly.

Pair Corralation between Stillfront Group and Clemondo Group

Assuming the 90 days horizon Stillfront Group AB is expected to generate 1.53 times more return on investment than Clemondo Group. However, Stillfront Group is 1.53 times more volatile than Clemondo Group AB. It trades about 0.07 of its potential returns per unit of risk. Clemondo Group AB is currently generating about -0.04 per unit of risk. If you would invest  721.00  in Stillfront Group AB on September 17, 2024 and sell it today you would earn a total of  91.00  from holding Stillfront Group AB or generate 12.62% return on investment over 90 days.

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

Stillfront Group AB  vs.  Clemondo Group AB

Stillfront Group

Risk-Adjusted Performance

5 of 100

OK

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

Clemondo Group AB

Risk-Adjusted Performance

0 of 100

Very Weak

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

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

The idea behind Stillfront Group AB and Clemondo Group 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.