Correlation Between Svenska Handelsbanken and Modus Therapeutics
Can any of the company-specific risk be diversified away by investing in both Svenska Handelsbanken and Modus Therapeutics 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 Svenska Handelsbanken and Modus Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Svenska Handelsbanken AB and Modus Therapeutics Holding, you can compare the effects of market volatilities on Svenska Handelsbanken and Modus Therapeutics 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 Svenska Handelsbanken with a short position of Modus Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svenska Handelsbanken and Modus Therapeutics.
Diversification Opportunities for Svenska Handelsbanken and Modus Therapeutics
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Svenska and Modus is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Svenska Handelsbanken AB and Modus Therapeutics Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modus Therapeutics and Svenska Handelsbanken 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 Svenska Handelsbanken AB are associated (or correlated) with Modus Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modus Therapeutics has no effect on the direction of Svenska Handelsbanken i.e., Svenska Handelsbanken and Modus Therapeutics go up and down completely randomly.
Pair Corralation between Svenska Handelsbanken and Modus Therapeutics
Assuming the 90 days trading horizon Svenska Handelsbanken AB is expected to generate 0.14 times more return on investment than Modus Therapeutics. However, Svenska Handelsbanken AB is 6.92 times less risky than Modus Therapeutics. It trades about 0.14 of its potential returns per unit of risk. Modus Therapeutics Holding is currently generating about -0.2 per unit of risk. If you would invest 19,950 in Svenska Handelsbanken AB on September 1, 2025 and sell it today you would earn a total of 2,290 from holding Svenska Handelsbanken AB or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Svenska Handelsbanken AB vs. Modus Therapeutics Holding
Performance |
| Timeline |
| Svenska Handelsbanken |
| Modus Therapeutics |
Svenska Handelsbanken and Modus Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Svenska Handelsbanken and Modus Therapeutics
The main advantage of trading using opposite Svenska Handelsbanken and Modus Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svenska Handelsbanken position performs unexpectedly, Modus Therapeutics 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 Modus Therapeutics will offset losses from the drop in Modus Therapeutics' long position.| Svenska Handelsbanken vs. FormPipe Software AB | Svenska Handelsbanken vs. Soder Sportfiske AB | Svenska Handelsbanken vs. Vitec Software Group | Svenska Handelsbanken vs. Nexam Chemical Holding |
| Modus Therapeutics vs. Systemair AB | Modus Therapeutics vs. Nitro Games Oyj | Modus Therapeutics vs. Nordic Iron Ore | Modus Therapeutics vs. Invisio Communications AB |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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