Correlation Between Smartphoto Group and Sequana Medical
Can any of the company-specific risk be diversified away by investing in both Smartphoto Group and Sequana 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 Smartphoto Group and Sequana Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smartphoto Group NV and Sequana Medical NV, you can compare the effects of market volatilities on Smartphoto Group and Sequana 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 Smartphoto Group with a short position of Sequana Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smartphoto Group and Sequana Medical.
Diversification Opportunities for Smartphoto Group and Sequana Medical
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Smartphoto and Sequana is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Smartphoto Group NV and Sequana Medical NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sequana Medical NV and Smartphoto Group 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 Smartphoto Group NV are associated (or correlated) with Sequana Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sequana Medical NV has no effect on the direction of Smartphoto Group i.e., Smartphoto Group and Sequana Medical go up and down completely randomly.
Pair Corralation between Smartphoto Group and Sequana Medical
Assuming the 90 days trading horizon Smartphoto Group NV is expected to generate 0.19 times more return on investment than Sequana Medical. However, Smartphoto Group NV is 5.39 times less risky than Sequana Medical. It trades about -0.28 of its potential returns per unit of risk. Sequana Medical NV is currently generating about -0.07 per unit of risk. If you would invest 2,390 in Smartphoto Group NV on November 1, 2024 and sell it today you would lose (250.00) from holding Smartphoto Group NV or give up 10.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smartphoto Group NV vs. Sequana Medical NV
Performance |
| Timeline |
| Smartphoto Group |
| Sequana Medical NV |
Smartphoto Group and Sequana Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smartphoto Group and Sequana Medical
The main advantage of trading using opposite Smartphoto Group and Sequana Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smartphoto Group position performs unexpectedly, Sequana 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 Sequana Medical will offset losses from the drop in Sequana Medical's long position.| Smartphoto Group vs. EVS Broadcast Equipment | Smartphoto Group vs. Tessenderlo | Smartphoto Group vs. Deceuninck | Smartphoto Group vs. Sipef NV |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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