Correlation Between Scandinavian Enviro and Episurf Medical
Can any of the company-specific risk be diversified away by investing in both Scandinavian Enviro and Episurf Medical 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 Scandinavian Enviro and Episurf Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scandinavian Enviro Systems and Episurf Medical AB, you can compare the effects of market volatilities on Scandinavian Enviro and Episurf Medical 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 Enviro with a short position of Episurf Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Enviro and Episurf Medical.
Diversification Opportunities for Scandinavian Enviro and Episurf Medical
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Scandinavian and Episurf is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Enviro Systems and Episurf Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Episurf Medical AB and Scandinavian Enviro 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 Enviro Systems are associated (or correlated) with Episurf Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Episurf Medical AB has no effect on the direction of Scandinavian Enviro i.e., Scandinavian Enviro and Episurf Medical go up and down completely randomly.
Pair Corralation between Scandinavian Enviro and Episurf Medical
Assuming the 90 days trading horizon Scandinavian Enviro Systems is expected to generate 0.4 times more return on investment than Episurf Medical. However, Scandinavian Enviro Systems is 2.49 times less risky than Episurf Medical. It trades about -0.06 of its potential returns per unit of risk. Episurf Medical AB is currently generating about -0.11 per unit of risk. If you would invest 242.00 in Scandinavian Enviro Systems on September 3, 2024 and sell it today you would lose (51.00) from holding Scandinavian Enviro Systems or give up 21.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scandinavian Enviro Systems vs. Episurf Medical AB
Performance |
| Timeline |
| Scandinavian Enviro |
| Episurf Medical AB |
Scandinavian Enviro and Episurf Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Enviro and Episurf Medical
The main advantage of trading using opposite Scandinavian Enviro and Episurf Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Enviro position performs unexpectedly, Episurf Medical 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 Episurf Medical will offset losses from the drop in Episurf Medical's long position.| Scandinavian Enviro vs. Minesto AB | Scandinavian Enviro vs. Sivers IMA Holding | Scandinavian Enviro vs. SolTech Energy Sweden | Scandinavian Enviro vs. AAC Clyde Space |
| Episurf Medical vs. BioInvent International AB | Episurf Medical vs. Cantargia AB | Episurf Medical vs. Bonesupport Holding AB | Episurf Medical vs. Bactiguard Holding AB |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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