Correlation Between Scandic Hotels and Invesco Physical
Can any of the company-specific risk be diversified away by investing in both Scandic Hotels and Invesco Physical 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 Scandic Hotels and Invesco Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scandic Hotels Group and Invesco Physical Silver, you can compare the effects of market volatilities on Scandic Hotels and Invesco Physical 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 Scandic Hotels with a short position of Invesco Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandic Hotels and Invesco Physical.
Diversification Opportunities for Scandic Hotels and Invesco Physical
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Scandic and Invesco is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Scandic Hotels Group and Invesco Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Physical Silver and Scandic Hotels 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 Scandic Hotels Group are associated (or correlated) with Invesco Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Physical Silver has no effect on the direction of Scandic Hotels i.e., Scandic Hotels and Invesco Physical go up and down completely randomly.
Pair Corralation between Scandic Hotels and Invesco Physical
Assuming the 90 days trading horizon Scandic Hotels Group is expected to generate 0.82 times more return on investment than Invesco Physical. However, Scandic Hotels Group is 1.22 times less risky than Invesco Physical. It trades about 0.12 of its potential returns per unit of risk. Invesco Physical Silver is currently generating about -0.11 per unit of risk. If you would invest 6,431 in Scandic Hotels Group on September 22, 2024 and sell it today you would earn a total of 249.00 from holding Scandic Hotels Group or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scandic Hotels Group vs. Invesco Physical Silver
Performance |
| Timeline |
| Scandic Hotels Group |
| Invesco Physical Silver |
Scandic Hotels and Invesco Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandic Hotels and Invesco Physical
The main advantage of trading using opposite Scandic Hotels and Invesco Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandic Hotels position performs unexpectedly, Invesco Physical 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 Invesco Physical will offset losses from the drop in Invesco Physical's long position.| Scandic Hotels vs. AfriTin Mining | Scandic Hotels vs. Foresight Environmental Infrastructure | Scandic Hotels vs. Iron Mountain | Scandic Hotels vs. CAP LEASE AVIATION |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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