Correlation Between Scibase AB and ScandiDos
Can any of the company-specific risk be diversified away by investing in both Scibase AB and ScandiDos 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 Scibase AB and ScandiDos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scibase AB and ScandiDos AB, you can compare the effects of market volatilities on Scibase AB and ScandiDos 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 Scibase AB with a short position of ScandiDos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scibase AB and ScandiDos.
Diversification Opportunities for Scibase AB and ScandiDos
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Scibase and ScandiDos is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Scibase AB and ScandiDos AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScandiDos AB and Scibase AB 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 Scibase AB are associated (or correlated) with ScandiDos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ScandiDos AB has no effect on the direction of Scibase AB i.e., Scibase AB and ScandiDos go up and down completely randomly.
Pair Corralation between Scibase AB and ScandiDos
Assuming the 90 days trading horizon Scibase AB is expected to under-perform the ScandiDos. In addition to that, Scibase AB is 3.38 times more volatile than ScandiDos AB. It trades about -0.17 of its total potential returns per unit of risk. ScandiDos AB is currently generating about 0.14 per unit of volatility. If you would invest 165.00 in ScandiDos AB on September 2, 2024 and sell it today you would earn a total of 7.00 from holding ScandiDos AB or generate 4.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scibase AB vs. ScandiDos AB
Performance |
| Timeline |
| Scibase AB |
| ScandiDos AB |
Scibase AB and ScandiDos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scibase AB and ScandiDos
The main advantage of trading using opposite Scibase AB and ScandiDos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scibase AB position performs unexpectedly, ScandiDos 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 ScandiDos will offset losses from the drop in ScandiDos' long position.| Scibase AB vs. Acarix AS | Scibase AB vs. Episurf Medical AB | Scibase AB vs. Xbrane Biopharma AB | Scibase AB vs. Scandinavian Enviro Systems |
| ScandiDos vs. Scibase AB | ScandiDos vs. Arcoma AB | ScandiDos vs. Lidds AB | ScandiDos vs. Clinical Laserthermia Systems |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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