Severn OTC Stock Volatility

SVTRF -  USA Stock  

USD 35.84  0.34  0.96%

We consider Severn Trent very steady. Severn Trent Plc owns Efficiency Ratio (i.e., Sharpe Ratio) of 0.0224, which indicates the firm had 0.0224% of return per unit of risk over the last 3 months. Our standpoint towards measuring the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-one technical indicators for Severn Trent Plc, which you can use to evaluate the future volatility of the company. Please validate Severn Trent coefficient of variation of 4524.05, and Risk Adjusted Performance of 0.0215 to confirm if the risk estimate we provide is consistent with the expected return of 0.0388%.

Severn Volatility 

 
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Severn Trent OTC Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Severn daily returns, and it is calculated using variance and standard deviation. We also use Severn's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Severn Trent volatility.

60 Days Market Risk

Very steady

Chance of Distress

Close to Average

60 Days Economic Sensitivity

Almost neglects market trends

Severn Trent Market Sensitivity And Downside Risk

Severn Trent's beta coefficient measures the volatility of Severn otc stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Severn otc stock's returns against your selected market. In other words, Severn Trent's beta of -0.48 provides an investor with an approximation of how much risk Severn Trent otc stock can potentially add to one of your existing portfolios.
Let's try to break down what Severn's beta means in this case. As returns on the market increase, returns on owning Severn Trent are expected to decrease at a much lower rate. During the bear market, Severn Trent is likely to outperform the market.
3 Months Beta |Analyze Severn Trent Plc Demand Trend
Check current 90 days Severn Trent correlation with market (DOW)

Severn Beta

    
  -0.48  
Severn standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  1.73  
It is essential to understand the difference between upside risk (as represented by Severn Trent's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Severn Trent stock's daily returns or price. Since the actual investment returns on holding a position in Severn Trent stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Severn Trent.

Severn Trent Plc OTC Stock Volatility Analysis

Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Severn Trent Plc Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input. View also all equity analysis or get more info about average price price transform indicator.

Severn Trent Projected Return Density Against Market

Assuming the 90 days horizon Severn Trent Plc has a beta of -0.4846 . This usually implies as returns on benchmark increase, returns on holding Severn Trent are expected to decrease at a much lower rate. During the bear market, however, Severn Trent Plc is likely to outperform the market.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Severn Trent or Utilities sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Severn Trent stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Severn stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.0407, implying that it can generate a 0.0407 percent excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 

Severn Trent OTC Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Severn Trent or Utilities sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Severn Trent stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Severn stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Assuming the 90 days horizon the coefficient of variation of Severn Trent is 4456.22. The daily returns are distributed with a variance of 2.99 and standard deviation of 1.73. The mean deviation of Severn Trent Plc is currently at 0.41. For similar time horizon, the selected benchmark (DOW) has volatility of 0.71
α
Alpha over DOW
0.0407
β
Beta against DOW-0.48
σ
Overall volatility
1.73
Ir
Information ratio 0.0003

Severn Trent OTC Stock Return Volatility

Severn Trent historical daily return volatility represents how much Severn Trent stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The firm shows 1.7279% volatility of returns over 90 . By contrast, DOW inherits 0.7131% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Severn Trent Volatility

Volatility is a rate at which the price of Severn Trent or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Severn Trent may increase or decrease. In other words, similar to Severn's beta indicator, it measures the risk of Severn Trent and helps estimate the fluctuations that may happen in a short period of time. So if prices of Severn Trent fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Severn Trent Plc operates as a water and sewerage company in England and Wales. The company was founded in 1974 and is headquartered in Coventry, the United Kingdom. Severn Trent operates under UtilitiesRegulated Water classification in the United States and is traded on OTC Exchange. It employs 7087 people.

Severn Trent Investment Opportunity

Severn Trent Plc has a volatility of 1.73 and is 2.44 times more volatile than DOW. 14  of all equities and portfolios are less risky than Severn Trent. Compared to the overall equity markets, volatility of historical daily returns of Severn Trent Plc is lower than 14 () of all global equities and portfolios over the last 90 days. Use Severn Trent Plc to enhance returns of your portfolios. The otc stock experiences a moderate upward volatility. Check odds of Severn Trent to be traded at $39.42 in 90 days. . Let's try to break down what Severn's beta means in this case. As returns on the market increase, returns on owning Severn Trent are expected to decrease at a much lower rate. During the bear market, Severn Trent is likely to outperform the market.

Good diversification

The correlation between Severn Trent Plc and DJI is Good diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Severn Trent Plc and DJI in the same portfolio assuming nothing else is changed.

Severn Trent Additional Risk Indicators

The analysis of Severn Trent's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Severn Trent's investment and either accepting that risk or mitigating it. Along with some common measures of Severn Trent stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance0.0215
Market Risk Adjusted Performance(0.046958)
Mean Deviation0.4024
Coefficient Of Variation4524.05
Standard Deviation1.7
Variance2.89
Information Ratio3.0E-4
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Severn Trent Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Severn Trent as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Severn Trent's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Severn Trent's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Severn Trent Plc.
Additionally, take a look at World Market Map. Note that the Severn Trent Plc information on this page should be used as a complementary analysis to other Severn Trent's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..

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When running Severn Trent Plc price analysis, check to measure Severn Trent's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Severn Trent is operating at the current time. Most of Severn Trent's value examination focuses on studying past and present price action to predict the probability of Severn Trent's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Severn Trent's price. Additionally, you may evaluate how the addition of Severn Trent to your portfolios can decrease your overall portfolio volatility.
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The market value of Severn Trent Plc is measured differently than its book value, which is the value of Severn that is recorded on the company's balance sheet. Investors also form their own opinion of Severn Trent's value that differs from its market value or its book value, called intrinsic value, which is Severn Trent's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Severn Trent's market value can be influenced by many factors that don't directly affect Severn Trent Plc underlying business (such as pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Severn Trent's value and its price as these two are different measures arrived at by different means. Investors typically determine Severn Trent value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Severn Trent's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.