Correlation Between Scandinavian Medical and IA Invest
Can any of the company-specific risk be diversified away by investing in both Scandinavian Medical and IA Invest 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 Medical and IA Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scandinavian Medical Solutions and IA Invest Peruma, you can compare the effects of market volatilities on Scandinavian Medical and IA Invest 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 Medical with a short position of IA Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Medical and IA Invest.
Diversification Opportunities for Scandinavian Medical and IA Invest
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Scandinavian and IAIPGA is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Medical Solutions and IA Invest Peruma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IA Invest Peruma and Scandinavian Medical 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 Medical Solutions are associated (or correlated) with IA Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IA Invest Peruma has no effect on the direction of Scandinavian Medical i.e., Scandinavian Medical and IA Invest go up and down completely randomly.
Pair Corralation between Scandinavian Medical and IA Invest
Assuming the 90 days trading horizon Scandinavian Medical Solutions is expected to under-perform the IA Invest. In addition to that, Scandinavian Medical is 1.69 times more volatile than IA Invest Peruma. It trades about -0.3 of its total potential returns per unit of risk. IA Invest Peruma is currently generating about 0.0 per unit of volatility. If you would invest 13,635 in IA Invest Peruma on September 29, 2024 and sell it today you would lose (30.00) from holding IA Invest Peruma or give up 0.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.68% |
| Values | Daily Returns |
Scandinavian Medical Solutions vs. IA Invest Peruma
Performance |
| Timeline |
| Scandinavian Medical |
| IA Invest Peruma |
Scandinavian Medical and IA Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Medical and IA Invest
The main advantage of trading using opposite Scandinavian Medical and IA Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Medical position performs unexpectedly, IA Invest 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 IA Invest will offset losses from the drop in IA Invest's long position.| Scandinavian Medical vs. Vestjysk Bank AS | Scandinavian Medical vs. BankInvest Value Globale | Scandinavian Medical vs. Formuepleje Mix Medium | Scandinavian Medical vs. TROPHY GAMES Development |
| IA Invest vs. BankInvest Value Globale | IA Invest vs. Scandinavian Medical Solutions | IA Invest vs. NTG Nordic Transport | IA Invest vs. Moens Bank 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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