Correlation Between Green Hydrogen and Scandinavian Brake
Can any of the company-specific risk be diversified away by investing in both Green Hydrogen and Scandinavian Brake 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 Green Hydrogen and Scandinavian Brake into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Hydrogen Systems and Scandinavian Brake Systems, you can compare the effects of market volatilities on Green Hydrogen and Scandinavian Brake 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 Green Hydrogen with a short position of Scandinavian Brake. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Hydrogen and Scandinavian Brake.
Diversification Opportunities for Green Hydrogen and Scandinavian Brake
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Green and Scandinavian is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Green Hydrogen Systems and Scandinavian Brake Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Brake and Green Hydrogen 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 Green Hydrogen Systems are associated (or correlated) with Scandinavian Brake. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Brake has no effect on the direction of Green Hydrogen i.e., Green Hydrogen and Scandinavian Brake go up and down completely randomly.
Pair Corralation between Green Hydrogen and Scandinavian Brake
Assuming the 90 days trading horizon Green Hydrogen Systems is expected to generate 9.1 times more return on investment than Scandinavian Brake. However, Green Hydrogen is 9.1 times more volatile than Scandinavian Brake Systems. It trades about 0.06 of its potential returns per unit of risk. Scandinavian Brake Systems is currently generating about 0.09 per unit of risk. If you would invest 220.00 in Green Hydrogen Systems on October 26, 2024 and sell it today you would earn a total of 21.00 from holding Green Hydrogen Systems or generate 9.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green Hydrogen Systems vs. Scandinavian Brake Systems
Performance |
| Timeline |
| Green Hydrogen Systems |
| Scandinavian Brake |
Green Hydrogen and Scandinavian Brake Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Hydrogen and Scandinavian Brake
The main advantage of trading using opposite Green Hydrogen and Scandinavian Brake positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Hydrogen position performs unexpectedly, Scandinavian Brake 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 Brake will offset losses from the drop in Scandinavian Brake's long position.| Green Hydrogen vs. Ambu AS | Green Hydrogen vs. GN Store Nord | Green Hydrogen vs. Bavarian Nordic | Green Hydrogen vs. FLSmidth Co |
| Scandinavian Brake vs. SKAKO AS | Scandinavian Brake vs. Newcap Holding AS | Scandinavian Brake vs. Columbus AS | Scandinavian Brake vs. Rovsing AS |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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