Correlation Between Sanoma Oyj and SSH Communications
Can any of the company-specific risk be diversified away by investing in both Sanoma Oyj and SSH Communications 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 Sanoma Oyj and SSH Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanoma Oyj and SSH Communications Security, you can compare the effects of market volatilities on Sanoma Oyj and SSH Communications 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 Sanoma Oyj with a short position of SSH Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanoma Oyj and SSH Communications.
Diversification Opportunities for Sanoma Oyj and SSH Communications
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sanoma and SSH is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Sanoma Oyj and SSH Communications Security in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSH Communications and Sanoma 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 Sanoma Oyj are associated (or correlated) with SSH Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSH Communications has no effect on the direction of Sanoma Oyj i.e., Sanoma Oyj and SSH Communications go up and down completely randomly.
Pair Corralation between Sanoma Oyj and SSH Communications
Assuming the 90 days trading horizon Sanoma Oyj is expected to generate 19.97 times less return on investment than SSH Communications. But when comparing it to its historical volatility, Sanoma Oyj is 1.86 times less risky than SSH Communications. It trades about 0.0 of its potential returns per unit of risk. SSH Communications Security is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 107.00 in SSH Communications Security on September 12, 2024 and sell it today you would earn a total of 2.00 from holding SSH Communications Security or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sanoma Oyj vs. SSH Communications Security
Performance |
| Timeline |
| Sanoma Oyj |
| SSH Communications |
Sanoma Oyj and SSH Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanoma Oyj and SSH Communications
The main advantage of trading using opposite Sanoma Oyj and SSH Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanoma Oyj position performs unexpectedly, SSH Communications 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 SSH Communications will offset losses from the drop in SSH Communications' long position.| Sanoma Oyj vs. QPR Software Oyj | Sanoma Oyj vs. Nordea Bank Abp | Sanoma Oyj vs. SSH Communications Security | Sanoma Oyj vs. Nightingale Health Oyj |
| SSH Communications vs. Tecnotree Oyj | SSH Communications vs. Qt Group Oyj | SSH Communications vs. Bittium Oyj | SSH Communications vs. Harvia 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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