Correlation Between GlaxoSmithKline PLC and Attendo AB
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Attendo AB 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 Attendo AB 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 Attendo AB, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Attendo AB 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 Attendo AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Attendo AB.
Diversification Opportunities for GlaxoSmithKline PLC and Attendo AB
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GlaxoSmithKline and Attendo is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Attendo AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Attendo 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 Attendo AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Attendo AB has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Attendo AB go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Attendo AB
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to under-perform the Attendo AB. In addition to that, GlaxoSmithKline PLC is 1.3 times more volatile than Attendo AB. It trades about -0.21 of its total potential returns per unit of risk. Attendo AB is currently generating about 0.0 per unit of volatility. If you would invest 4,855 in Attendo AB on August 25, 2024 and sell it today you would lose (35.00) from holding Attendo AB or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Attendo AB
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Attendo AB |
GlaxoSmithKline PLC and Attendo AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Attendo AB
The main advantage of trading using opposite GlaxoSmithKline PLC and Attendo AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Attendo AB 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 Attendo AB will offset losses from the drop in Attendo AB'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 |
| Attendo AB vs. Dometic Group AB | Attendo AB vs. Bonava AB | Attendo AB vs. Bravida Holding AB | Attendo AB vs. KABE Group AB |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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