Correlation Between Carnegie Wealth and Scandinavian Medical
Can any of the company-specific risk be diversified away by investing in both Carnegie Wealth and Scandinavian Medical 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 Carnegie Wealth and Scandinavian Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carnegie Wealth Management and Scandinavian Medical Solutions, you can compare the effects of market volatilities on Carnegie Wealth and Scandinavian Medical 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 Carnegie Wealth with a short position of Scandinavian Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carnegie Wealth and Scandinavian Medical.
Diversification Opportunities for Carnegie Wealth and Scandinavian Medical
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Carnegie and Scandinavian is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Carnegie Wealth Management and Scandinavian Medical Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Medical and Carnegie Wealth 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 Carnegie Wealth Management are associated (or correlated) with Scandinavian Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Medical has no effect on the direction of Carnegie Wealth i.e., Carnegie Wealth and Scandinavian Medical go up and down completely randomly.
Pair Corralation between Carnegie Wealth and Scandinavian Medical
Assuming the 90 days trading horizon Carnegie Wealth Management is expected to generate 0.35 times more return on investment than Scandinavian Medical. However, Carnegie Wealth Management is 2.86 times less risky than Scandinavian Medical. It trades about 0.03 of its potential returns per unit of risk. Scandinavian Medical Solutions is currently generating about -0.11 per unit of risk. If you would invest 12,700 in Carnegie Wealth Management on November 1, 2024 and sell it today you would earn a total of 220.00 from holding Carnegie Wealth Management or generate 1.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
Carnegie Wealth Management vs. Scandinavian Medical Solutions
Performance |
| Timeline |
| Carnegie Wealth Mana |
| Scandinavian Medical |
Carnegie Wealth and Scandinavian Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carnegie Wealth and Scandinavian Medical
The main advantage of trading using opposite Carnegie Wealth and Scandinavian Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carnegie Wealth position performs unexpectedly, Scandinavian Medical 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 Medical will offset losses from the drop in Scandinavian Medical's long position.| Carnegie Wealth vs. Embla Medical hf | Carnegie Wealth vs. Alefarm Brewing AS | Carnegie Wealth vs. Nordinvestments AS | Carnegie Wealth vs. Strategic Investments AS |
| Scandinavian Medical vs. Dataproces Group AS | Scandinavian Medical vs. NTG Nordic Transport | Scandinavian Medical vs. Alefarm Brewing AS | Scandinavian Medical vs. Carnegie Wealth 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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