Correlation Between NAKED WINES and SCANDMEDICAL SOLDK-040
Can any of the company-specific risk be diversified away by investing in both NAKED WINES and SCANDMEDICAL SOLDK-040 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 NAKED WINES and SCANDMEDICAL SOLDK-040 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAKED WINES PLC and SCANDMEDICAL SOLDK 040, you can compare the effects of market volatilities on NAKED WINES and SCANDMEDICAL SOLDK-040 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 NAKED WINES with a short position of SCANDMEDICAL SOLDK-040. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAKED WINES and SCANDMEDICAL SOLDK-040.
Diversification Opportunities for NAKED WINES and SCANDMEDICAL SOLDK-040
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NAKED and SCANDMEDICAL is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding NAKED WINES PLC and SCANDMEDICAL SOLDK 040 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCANDMEDICAL SOLDK 040 and NAKED WINES 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 NAKED WINES PLC are associated (or correlated) with SCANDMEDICAL SOLDK-040. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCANDMEDICAL SOLDK 040 has no effect on the direction of NAKED WINES i.e., NAKED WINES and SCANDMEDICAL SOLDK-040 go up and down completely randomly.
Pair Corralation between NAKED WINES and SCANDMEDICAL SOLDK-040
Assuming the 90 days horizon NAKED WINES PLC is expected to under-perform the SCANDMEDICAL SOLDK-040. But the stock apears to be less risky and, when comparing its historical volatility, NAKED WINES PLC is 1.88 times less risky than SCANDMEDICAL SOLDK-040. The stock trades about -0.01 of its potential returns per unit of risk. The SCANDMEDICAL SOLDK 040 is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 88.00 in SCANDMEDICAL SOLDK 040 on September 3, 2024 and sell it today you would lose (9.00) from holding SCANDMEDICAL SOLDK 040 or give up 10.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NAKED WINES PLC vs. SCANDMEDICAL SOLDK 040
Performance |
| Timeline |
| NAKED WINES PLC |
| SCANDMEDICAL SOLDK 040 |
NAKED WINES and SCANDMEDICAL SOLDK-040 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAKED WINES and SCANDMEDICAL SOLDK-040
The main advantage of trading using opposite NAKED WINES and SCANDMEDICAL SOLDK-040 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAKED WINES position performs unexpectedly, SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK-040 will offset losses from the drop in SCANDMEDICAL SOLDK-040's long position.| NAKED WINES vs. CHINA TONTINE WINES | NAKED WINES vs. Superior Plus Corp | NAKED WINES vs. NMI Holdings | NAKED WINES vs. Origin Agritech |
| SCANDMEDICAL SOLDK-040 vs. Stryker | SCANDMEDICAL SOLDK-040 vs. Insulet | SCANDMEDICAL SOLDK-040 vs. Superior Plus Corp | SCANDMEDICAL SOLDK-040 vs. NMI Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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