Correlation Between Scandinavian Tobacco and Pintec Technology
Can any of the company-specific risk be diversified away by investing in both Scandinavian Tobacco and Pintec Technology 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 Tobacco and Pintec Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scandinavian Tobacco Group and Pintec Technology Holdings, you can compare the effects of market volatilities on Scandinavian Tobacco and Pintec Technology 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 Tobacco with a short position of Pintec Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scandinavian Tobacco and Pintec Technology.
Diversification Opportunities for Scandinavian Tobacco and Pintec Technology
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Scandinavian and Pintec is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Scandinavian Tobacco Group and Pintec Technology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pintec Technology and Scandinavian Tobacco 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 Tobacco Group are associated (or correlated) with Pintec Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pintec Technology has no effect on the direction of Scandinavian Tobacco i.e., Scandinavian Tobacco and Pintec Technology go up and down completely randomly.
Pair Corralation between Scandinavian Tobacco and Pintec Technology
Assuming the 90 days horizon Scandinavian Tobacco Group is expected to under-perform the Pintec Technology. But the pink sheet apears to be less risky and, when comparing its historical volatility, Scandinavian Tobacco Group is 2.5 times less risky than Pintec Technology. The pink sheet trades about -0.29 of its potential returns per unit of risk. The Pintec Technology Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 100.00 in Pintec Technology Holdings on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Pintec Technology Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scandinavian Tobacco Group vs. Pintec Technology Holdings
Performance |
| Timeline |
| Scandinavian Tobacco |
| Pintec Technology |
Scandinavian Tobacco and Pintec Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scandinavian Tobacco and Pintec Technology
The main advantage of trading using opposite Scandinavian Tobacco and Pintec Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scandinavian Tobacco position performs unexpectedly, Pintec Technology 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 Pintec Technology will offset losses from the drop in Pintec Technology's long position.| Scandinavian Tobacco vs. Universal | Scandinavian Tobacco vs. Imperial Brands PLC | Scandinavian Tobacco vs. Japan Tobacco ADR | Scandinavian Tobacco vs. Philip Morris International |
| Pintec Technology vs. SLM Corp | Pintec Technology vs. Orix Corp Ads | Pintec Technology vs. FirstCash | Pintec Technology vs. Medallion Financial Corp |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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