Correlation Between Scandinavian Tobacco and TR Property
Can any of the company-specific risk be diversified away by investing in both Scandinavian Tobacco and TR Property 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 Scandinavian Tobacco and TR Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scandinavian Tobacco Group and TR Property Investment, you can compare the effects of market volatilities on Scandinavian Tobacco and TR Property 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 Scandinavian Tobacco with a short position of TR Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Tobacco and TR Property.
Diversification Opportunities for Scandinavian Tobacco and TR Property
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Scandinavian and TRY is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Tobacco Group and TR Property Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TR Property Investment and Scandinavian Tobacco 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 Scandinavian Tobacco Group are associated (or correlated) with TR Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TR Property Investment has no effect on the direction of Scandinavian Tobacco i.e., Scandinavian Tobacco and TR Property go up and down completely randomly.
Pair Corralation between Scandinavian Tobacco and TR Property
Assuming the 90 days trading horizon Scandinavian Tobacco Group is expected to under-perform the TR Property. In addition to that, Scandinavian Tobacco is 1.65 times more volatile than TR Property Investment. It trades about -0.11 of its total potential returns per unit of risk. TR Property Investment is currently generating about -0.14 per unit of volatility. If you would invest 33,100 in TR Property Investment on August 29, 2024 and sell it today you would lose (1,250) from holding TR Property Investment or give up 3.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scandinavian Tobacco Group vs. TR Property Investment
Performance |
| Timeline |
| Scandinavian Tobacco |
| TR Property Investment |
Scandinavian Tobacco and TR Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Tobacco and TR Property
The main advantage of trading using opposite Scandinavian Tobacco and TR Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Tobacco position performs unexpectedly, TR Property 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 TR Property will offset losses from the drop in TR Property's long position.| Scandinavian Tobacco vs. Lendinvest PLC | Scandinavian Tobacco vs. Neometals | Scandinavian Tobacco vs. Coor Service Management | Scandinavian Tobacco vs. Albion Technology General |
| TR Property vs. Toyota Motor Corp | TR Property vs. Lendinvest PLC | TR Property vs. Neometals | TR Property vs. Coor Service Management |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |