Correlation Between KONE Oyj and Scanfil Oyj
Can any of the company-specific risk be diversified away by investing in both KONE Oyj and Scanfil Oyj 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 KONE Oyj and Scanfil Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KONE Oyj and Scanfil Oyj, you can compare the effects of market volatilities on KONE Oyj and Scanfil Oyj 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 KONE Oyj with a short position of Scanfil Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of KONE Oyj and Scanfil Oyj.
Diversification Opportunities for KONE Oyj and Scanfil Oyj
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KONE and Scanfil is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding KONE Oyj and Scanfil Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scanfil Oyj and KONE Oyj 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 KONE Oyj are associated (or correlated) with Scanfil Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scanfil Oyj has no effect on the direction of KONE Oyj i.e., KONE Oyj and Scanfil Oyj go up and down completely randomly.
Pair Corralation between KONE Oyj and Scanfil Oyj
Assuming the 90 days trading horizon KONE Oyj is expected to under-perform the Scanfil Oyj. In addition to that, KONE Oyj is 1.02 times more volatile than Scanfil Oyj. It trades about -0.25 of its total potential returns per unit of risk. Scanfil Oyj is currently generating about -0.16 per unit of volatility. If you would invest 785.00 in Scanfil Oyj on August 30, 2024 and sell it today you would lose (37.00) from holding Scanfil Oyj or give up 4.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KONE Oyj vs. Scanfil Oyj
Performance |
| Timeline |
| KONE Oyj |
| Scanfil Oyj |
KONE Oyj and Scanfil Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KONE Oyj and Scanfil Oyj
The main advantage of trading using opposite KONE Oyj and Scanfil Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KONE Oyj position performs unexpectedly, Scanfil Oyj 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 Scanfil Oyj will offset losses from the drop in Scanfil Oyj's long position.| KONE Oyj vs. Sampo Oyj A | KONE Oyj vs. Fortum Oyj | KONE Oyj vs. UPM Kymmene Oyj | KONE Oyj vs. Neste Oil Oyj |
| Scanfil Oyj vs. Tokmanni Group Oyj | Scanfil Oyj vs. Kemira Oyj | Scanfil Oyj vs. Valmet Oyj | Scanfil Oyj vs. Etteplan Oyj |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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