Correlation Between Scandinavian Tobacco and PLAY2CHILL
Can any of the company-specific risk be diversified away by investing in both Scandinavian Tobacco and PLAY2CHILL 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 PLAY2CHILL 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 PLAY2CHILL SA ZY, you can compare the effects of market volatilities on Scandinavian Tobacco and PLAY2CHILL 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 PLAY2CHILL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Tobacco and PLAY2CHILL.
Diversification Opportunities for Scandinavian Tobacco and PLAY2CHILL
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Scandinavian and PLAY2CHILL is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Tobacco Group and PLAY2CHILL SA ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAY2CHILL SA ZY 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 PLAY2CHILL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAY2CHILL SA ZY has no effect on the direction of Scandinavian Tobacco i.e., Scandinavian Tobacco and PLAY2CHILL go up and down completely randomly.
Pair Corralation between Scandinavian Tobacco and PLAY2CHILL
Assuming the 90 days horizon Scandinavian Tobacco Group is expected to generate 1.2 times more return on investment than PLAY2CHILL. However, Scandinavian Tobacco is 1.2 times more volatile than PLAY2CHILL SA ZY. It trades about 0.15 of its potential returns per unit of risk. PLAY2CHILL SA ZY is currently generating about 0.17 per unit of risk. If you would invest 1,270 in Scandinavian Tobacco Group on October 17, 2024 and sell it today you would earn a total of 52.00 from holding Scandinavian Tobacco Group or generate 4.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Scandinavian Tobacco Group vs. PLAY2CHILL SA ZY
Performance |
| Timeline |
| Scandinavian Tobacco |
| PLAY2CHILL SA ZY |
Scandinavian Tobacco and PLAY2CHILL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Tobacco and PLAY2CHILL
The main advantage of trading using opposite Scandinavian Tobacco and PLAY2CHILL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Tobacco position performs unexpectedly, PLAY2CHILL 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 PLAY2CHILL will offset losses from the drop in PLAY2CHILL's long position.| Scandinavian Tobacco vs. URBAN OUTFITTERS | Scandinavian Tobacco vs. Urban Outfitters | Scandinavian Tobacco vs. Transport International Holdings | Scandinavian Tobacco vs. Gaztransport Technigaz SA |
| PLAY2CHILL vs. IMPERIAL TOBACCO | PLAY2CHILL vs. Scandinavian Tobacco Group | PLAY2CHILL vs. Japan Tobacco | PLAY2CHILL vs. OURGAME INTHOLDL 00005 |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |