Correlation Between Scandinavian Brake and LED IBond
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By analyzing existing cross correlation between Scandinavian Brake Systems and LED iBond International, you can compare the effects of market volatilities on Scandinavian Brake and LED IBond 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 Scandinavian Brake with a short position of LED IBond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Brake and LED IBond.
Diversification Opportunities for Scandinavian Brake and LED IBond
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Scandinavian and LED is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Brake Systems and LED iBond International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LED iBond International and Scandinavian Brake 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 Scandinavian Brake Systems are associated (or correlated) with LED IBond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LED iBond International has no effect on the direction of Scandinavian Brake i.e., Scandinavian Brake and LED IBond go up and down completely randomly.
Pair Corralation between Scandinavian Brake and LED IBond
Assuming the 90 days trading horizon Scandinavian Brake is expected to generate 5.35 times less return on investment than LED IBond. But when comparing it to its historical volatility, Scandinavian Brake Systems is 10.98 times less risky than LED IBond. It trades about 0.15 of its potential returns per unit of risk. LED iBond International is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 32.00 in LED iBond International on September 26, 2024 and sell it today you would earn a total of 1.00 from holding LED iBond International or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scandinavian Brake Systems vs. LED iBond International
Performance |
| Timeline |
| Scandinavian Brake |
| LED iBond International |
Scandinavian Brake and LED IBond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Brake and LED IBond
The main advantage of trading using opposite Scandinavian Brake and LED IBond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Brake position performs unexpectedly, LED IBond 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 LED IBond will offset losses from the drop in LED IBond's long position.| Scandinavian Brake vs. Broendbyernes IF Fodbold | Scandinavian Brake vs. Matas AS | Scandinavian Brake vs. NKT AS | Scandinavian Brake vs. Jyske Bank AS |
| LED IBond vs. Netcompany Group AS | LED IBond vs. Scandinavian Brake Systems | LED IBond vs. Jyske Invest Virksomhedsobligationer | LED IBond vs. Penneo AS |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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