Correlation Between SCANDMEDICAL SOLDK-040 and WW Grainger
Can any of the company-specific risk be diversified away by investing in both SCANDMEDICAL SOLDK-040 and WW Grainger 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 WW Grainger 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 WW Grainger, you can compare the effects of market volatilities on SCANDMEDICAL SOLDK-040 and WW Grainger 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 WW Grainger. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANDMEDICAL SOLDK-040 and WW Grainger.
Diversification Opportunities for SCANDMEDICAL SOLDK-040 and WW Grainger
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SCANDMEDICAL and GWW is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding SCANDMEDICAL SOLDK 040 and WW Grainger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WW Grainger 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 WW Grainger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WW Grainger has no effect on the direction of SCANDMEDICAL SOLDK-040 i.e., SCANDMEDICAL SOLDK-040 and WW Grainger go up and down completely randomly.
Pair Corralation between SCANDMEDICAL SOLDK-040 and WW Grainger
Assuming the 90 days horizon SCANDMEDICAL SOLDK 040 is expected to generate 2.05 times more return on investment than WW Grainger. However, SCANDMEDICAL SOLDK-040 is 2.05 times more volatile than WW Grainger. It trades about -0.04 of its potential returns per unit of risk. WW Grainger is currently generating about -0.69 per unit of risk. If you would invest 77.00 in SCANDMEDICAL SOLDK 040 on October 7, 2024 and sell it today you would lose (1.00) from holding SCANDMEDICAL SOLDK 040 or give up 1.3% 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. WW Grainger
Performance |
| Timeline |
| SCANDMEDICAL SOLDK 040 |
| WW Grainger |
SCANDMEDICAL SOLDK-040 and WW Grainger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCANDMEDICAL SOLDK-040 and WW Grainger
The main advantage of trading using opposite SCANDMEDICAL SOLDK-040 and WW Grainger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCANDMEDICAL SOLDK-040 position performs unexpectedly, WW Grainger 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 WW Grainger will offset losses from the drop in WW Grainger's long position.| SCANDMEDICAL SOLDK-040 vs. Boston Scientific | SCANDMEDICAL SOLDK-040 vs. Zimmer Biomet Holdings | SCANDMEDICAL SOLDK-040 vs. Align Technology | SCANDMEDICAL SOLDK-040 vs. Superior Plus Corp |
| WW Grainger vs. Austevoll Seafood ASA | WW Grainger vs. GRUPO CARSO A1 | WW Grainger vs. GEELY AUTOMOBILE | WW Grainger vs. EBRO FOODS |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |