Correlation Between Scandinavian Tobacco and ANGLER GAMING
Can any of the company-specific risk be diversified away by investing in both Scandinavian Tobacco and ANGLER GAMING 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 ANGLER GAMING 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 ANGLER GAMING PLC, you can compare the effects of market volatilities on Scandinavian Tobacco and ANGLER GAMING 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 ANGLER GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Tobacco and ANGLER GAMING.
Diversification Opportunities for Scandinavian Tobacco and ANGLER GAMING
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Scandinavian and ANGLER is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Tobacco Group and ANGLER GAMING PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGLER GAMING PLC 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 ANGLER GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGLER GAMING PLC has no effect on the direction of Scandinavian Tobacco i.e., Scandinavian Tobacco and ANGLER GAMING go up and down completely randomly.
Pair Corralation between Scandinavian Tobacco and ANGLER GAMING
Assuming the 90 days horizon Scandinavian Tobacco Group is expected to generate 0.6 times more return on investment than ANGLER GAMING. However, Scandinavian Tobacco Group is 1.66 times less risky than ANGLER GAMING. It trades about -0.11 of its potential returns per unit of risk. ANGLER GAMING PLC is currently generating about -0.11 per unit of risk. If you would invest 1,366 in Scandinavian Tobacco Group on September 13, 2024 and sell it today you would lose (96.00) from holding Scandinavian Tobacco Group or give up 7.03% 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. ANGLER GAMING PLC
Performance |
| Timeline |
| Scandinavian Tobacco |
| ANGLER GAMING PLC |
Scandinavian Tobacco and ANGLER GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Tobacco and ANGLER GAMING
The main advantage of trading using opposite Scandinavian Tobacco and ANGLER GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Tobacco position performs unexpectedly, ANGLER GAMING 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 ANGLER GAMING will offset losses from the drop in ANGLER GAMING's long position.| Scandinavian Tobacco vs. HomeToGo SE | Scandinavian Tobacco vs. Gruppo Mutuionline SpA | Scandinavian Tobacco vs. SIEM OFFSHORE NEW | Scandinavian Tobacco vs. Taylor Morrison Home |
| ANGLER GAMING vs. Scientific Games | ANGLER GAMING vs. International Game Technology | ANGLER GAMING vs. Superior Plus Corp | ANGLER GAMING vs. SIVERS SEMICONDUCTORS 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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