Correlation Between Rolling Optics and Gasporox

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

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

Diversification Opportunities for Rolling Optics and Gasporox

-0.36

Correlation Coefficient

Rolling Optics  Gasporox

Very good diversification

The 3 months correlation between Rolling and Gasporox is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Rolling Optics Holding and Gasporox AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gasporox AB and Rolling Optics 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 Rolling Optics Holding are associated (or correlated) with Gasporox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gasporox AB has no effect on the direction of Rolling Optics i.e., Rolling Optics and Gasporox go up and down completely randomly.

Pair Corralation between Rolling Optics and Gasporox

Assuming the 90 days horizon Rolling Optics Holding is expected to under-perform the Gasporox. In addition to that, Rolling Optics is 1.09 times more volatile than Gasporox AB. It trades about -0.14 of its total potential returns per unit of risk. Gasporox AB is currently generating about -0.14 per unit of volatility. If you would invest  1,240  in Gasporox AB on February 1, 2024 and sell it today you would lose (180.00) from holding Gasporox AB or give up 14.52% of portfolio value over 90 days.

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

Rolling Optics Holding  vs.  Gasporox AB

Rolling Optics Holding

Risk-Adjusted Performance

5 of 100

Modest

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

Gasporox AB

Risk-Adjusted Performance

0 of 100

Very Weak

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

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

The idea behind Rolling Optics Holding and Gasporox 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.