Correlation Between SCANDMEDICAL SOLDK-040 and Air Liquide
Can any of the company-specific risk be diversified away by investing in both SCANDMEDICAL SOLDK-040 and Air Liquide 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 SCANDMEDICAL SOLDK-040 and Air Liquide into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCANDMEDICAL SOLDK 040 and Air Liquide SA, you can compare the effects of market volatilities on SCANDMEDICAL SOLDK-040 and Air Liquide 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 SCANDMEDICAL SOLDK-040 with a short position of Air Liquide. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANDMEDICAL SOLDK-040 and Air Liquide.
Diversification Opportunities for SCANDMEDICAL SOLDK-040 and Air Liquide
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SCANDMEDICAL and Air is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding SCANDMEDICAL SOLDK 040 and Air Liquide SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Liquide SA and SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK 040 are associated (or correlated) with Air Liquide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Liquide SA has no effect on the direction of SCANDMEDICAL SOLDK-040 i.e., SCANDMEDICAL SOLDK-040 and Air Liquide go up and down completely randomly.
Pair Corralation between SCANDMEDICAL SOLDK-040 and Air Liquide
Assuming the 90 days horizon SCANDMEDICAL SOLDK 040 is expected to generate 3.51 times more return on investment than Air Liquide. However, SCANDMEDICAL SOLDK-040 is 3.51 times more volatile than Air Liquide SA. It trades about 0.0 of its potential returns per unit of risk. Air Liquide SA is currently generating about -0.21 per unit of risk. If you would invest 80.00 in SCANDMEDICAL SOLDK 040 on September 3, 2024 and sell it today you would lose (1.00) from holding SCANDMEDICAL SOLDK 040 or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCANDMEDICAL SOLDK 040 vs. Air Liquide SA
Performance |
| Timeline |
| SCANDMEDICAL SOLDK 040 |
| Air Liquide SA |
SCANDMEDICAL SOLDK-040 and Air Liquide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCANDMEDICAL SOLDK-040 and Air Liquide
The main advantage of trading using opposite SCANDMEDICAL SOLDK-040 and Air Liquide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANDMEDICAL SOLDK-040 position performs unexpectedly, Air Liquide 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 Air Liquide will offset losses from the drop in Air Liquide's long position.| SCANDMEDICAL SOLDK-040 vs. Stryker | SCANDMEDICAL SOLDK-040 vs. Insulet | SCANDMEDICAL SOLDK-040 vs. Superior Plus Corp | SCANDMEDICAL SOLDK-040 vs. NMI Holdings |
| Air Liquide vs. MARKET VECTR RETAIL | Air Liquide vs. Food Life Companies | Air Liquide vs. PICKN PAY STORES | Air Liquide vs. Austevoll Seafood ASA |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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