Correlation Between SCANDION ONC and AutoNation
Can any of the company-specific risk be diversified away by investing in both SCANDION ONC and AutoNation 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 SCANDION ONC and AutoNation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCANDION ONC DK 0735 and AutoNation, you can compare the effects of market volatilities on SCANDION ONC and AutoNation 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 SCANDION ONC with a short position of AutoNation. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANDION ONC and AutoNation.
Diversification Opportunities for SCANDION ONC and AutoNation
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SCANDION and AutoNation is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding SCANDION ONC DK 0735 and AutoNation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AutoNation and SCANDION ONC 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 SCANDION ONC DK 0735 are associated (or correlated) with AutoNation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AutoNation has no effect on the direction of SCANDION ONC i.e., SCANDION ONC and AutoNation go up and down completely randomly.
Pair Corralation between SCANDION ONC and AutoNation
Assuming the 90 days horizon SCANDION ONC DK 0735 is expected to generate 3.8 times more return on investment than AutoNation. However, SCANDION ONC is 3.8 times more volatile than AutoNation. It trades about 0.14 of its potential returns per unit of risk. AutoNation is currently generating about -0.03 per unit of risk. If you would invest 0.58 in SCANDION ONC DK 0735 on September 25, 2024 and sell it today you would earn a total of 0.08 from holding SCANDION ONC DK 0735 or generate 13.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCANDION ONC DK 0735 vs. AutoNation
Performance |
| Timeline |
| SCANDION ONC DK |
| AutoNation |
SCANDION ONC and AutoNation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCANDION ONC and AutoNation
The main advantage of trading using opposite SCANDION ONC and AutoNation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANDION ONC position performs unexpectedly, AutoNation 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 AutoNation will offset losses from the drop in AutoNation's long position.| SCANDION ONC vs. Fast Retailing Co | SCANDION ONC vs. Tradeweb Markets | SCANDION ONC vs. Scandinavian Tobacco Group | SCANDION ONC vs. MARKET VECTR RETAIL |
| AutoNation vs. Copart Inc | AutoNation vs. Zhongsheng Group Holdings | AutoNation vs. CarMax Inc | AutoNation vs. DIeteren Group SA |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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