Correlation Between GlaxoSmithKline PLC and Acconeer
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Acconeer 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 GlaxoSmithKline PLC and Acconeer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Acconeer AB, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Acconeer 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 GlaxoSmithKline PLC with a short position of Acconeer. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Acconeer.
Diversification Opportunities for GlaxoSmithKline PLC and Acconeer
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between GlaxoSmithKline and Acconeer is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Acconeer AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acconeer AB and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with Acconeer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acconeer AB has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Acconeer go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Acconeer
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to generate 0.53 times more return on investment than Acconeer. However, GlaxoSmithKline PLC ADR is 1.9 times less risky than Acconeer. It trades about -0.23 of its potential returns per unit of risk. Acconeer AB is currently generating about -0.12 per unit of risk. If you would invest 3,659 in GlaxoSmithKline PLC ADR on August 31, 2024 and sell it today you would lose (226.00) from holding GlaxoSmithKline PLC ADR or give up 6.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Acconeer AB
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Acconeer AB |
GlaxoSmithKline PLC and Acconeer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Acconeer
The main advantage of trading using opposite GlaxoSmithKline PLC and Acconeer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Acconeer 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 Acconeer will offset losses from the drop in Acconeer's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
| Acconeer vs. Divio Technologies AB | Acconeer vs. XMReality AB | Acconeer vs. KABE Group AB | Acconeer vs. IAR Systems Group |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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