Correlation Between Chiba Bank and Scandinavian Tobacco
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Scandinavian Tobacco 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 Chiba Bank and Scandinavian Tobacco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank Ltd and Scandinavian Tobacco Group, you can compare the effects of market volatilities on Chiba Bank and Scandinavian Tobacco 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 Chiba Bank with a short position of Scandinavian Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Scandinavian Tobacco.
Diversification Opportunities for Chiba Bank and Scandinavian Tobacco
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chiba and Scandinavian is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank Ltd and Scandinavian Tobacco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Tobacco and Chiba Bank 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 Chiba Bank Ltd are associated (or correlated) with Scandinavian Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Tobacco has no effect on the direction of Chiba Bank i.e., Chiba Bank and Scandinavian Tobacco go up and down completely randomly.
Pair Corralation between Chiba Bank and Scandinavian Tobacco
If you would invest 3,768 in Chiba Bank Ltd on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Chiba Bank Ltd or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiba Bank Ltd vs. Scandinavian Tobacco Group
Performance |
| Timeline |
| Chiba Bank |
| Scandinavian Tobacco |
Chiba Bank and Scandinavian Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Scandinavian Tobacco
The main advantage of trading using opposite Chiba Bank and Scandinavian Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Scandinavian Tobacco 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 Scandinavian Tobacco will offset losses from the drop in Scandinavian Tobacco's long position.| Chiba Bank vs. Bank Mandiri Persero | Chiba Bank vs. Piraeus Bank SA | Chiba Bank vs. Eurobank Ergasias Services | Chiba Bank vs. Kasikornbank Public Co |
| Scandinavian Tobacco vs. Universal | Scandinavian Tobacco vs. Imperial Brands PLC | Scandinavian Tobacco vs. Japan Tobacco ADR | Scandinavian Tobacco vs. Philip Morris International |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |