Correlation Between Pfeiffer Vacuum and Scandic Hotels
Can any of the company-specific risk be diversified away by investing in both Pfeiffer Vacuum and Scandic Hotels 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 Pfeiffer Vacuum and Scandic Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pfeiffer Vacuum Technology and Scandic Hotels Group, you can compare the effects of market volatilities on Pfeiffer Vacuum and Scandic Hotels 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 Pfeiffer Vacuum with a short position of Scandic Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pfeiffer Vacuum and Scandic Hotels.
Diversification Opportunities for Pfeiffer Vacuum and Scandic Hotels
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pfeiffer and Scandic is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Pfeiffer Vacuum Technology and Scandic Hotels Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandic Hotels Group and Pfeiffer Vacuum 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 Pfeiffer Vacuum Technology are associated (or correlated) with Scandic Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandic Hotels Group has no effect on the direction of Pfeiffer Vacuum i.e., Pfeiffer Vacuum and Scandic Hotels go up and down completely randomly.
Pair Corralation between Pfeiffer Vacuum and Scandic Hotels
Assuming the 90 days trading horizon Pfeiffer Vacuum is expected to generate 17.16 times less return on investment than Scandic Hotels. But when comparing it to its historical volatility, Pfeiffer Vacuum Technology is 4.32 times less risky than Scandic Hotels. It trades about 0.09 of its potential returns per unit of risk. Scandic Hotels Group is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 6,845 in Scandic Hotels Group on November 3, 2024 and sell it today you would earn a total of 883.00 from holding Scandic Hotels Group or generate 12.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pfeiffer Vacuum Technology vs. Scandic Hotels Group
Performance |
| Timeline |
| Pfeiffer Vacuum Tech |
| Scandic Hotels Group |
Pfeiffer Vacuum and Scandic Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pfeiffer Vacuum and Scandic Hotels
The main advantage of trading using opposite Pfeiffer Vacuum and Scandic Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pfeiffer Vacuum position performs unexpectedly, Scandic Hotels 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 Scandic Hotels will offset losses from the drop in Scandic Hotels' long position.| Pfeiffer Vacuum vs. GreenX Metals | Pfeiffer Vacuum vs. Coor Service Management | Pfeiffer Vacuum vs. Impax Asset Management | Pfeiffer Vacuum vs. Adriatic Metals |
| Scandic Hotels vs. Zegona Communications Plc | Scandic Hotels vs. Take Two Interactive Software | Scandic Hotels vs. Sunny Optical Technology | Scandic Hotels vs. Zoom Video Communications |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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