Correlation Between Stenocare and RTX AS
Can any of the company-specific risk be diversified away by investing in both Stenocare and RTX AS 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 Stenocare and RTX AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stenocare AS and RTX AS, you can compare the effects of market volatilities on Stenocare and RTX AS 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 Stenocare with a short position of RTX AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stenocare and RTX AS.
Diversification Opportunities for Stenocare and RTX AS
Poor diversification
The 3 months correlation between Stenocare and RTX is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Stenocare AS and RTX AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RTX AS and Stenocare 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 Stenocare AS are associated (or correlated) with RTX AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RTX AS has no effect on the direction of Stenocare i.e., Stenocare and RTX AS go up and down completely randomly.
Pair Corralation between Stenocare and RTX AS
Assuming the 90 days trading horizon Stenocare AS is expected to generate 2.85 times more return on investment than RTX AS. However, Stenocare is 2.85 times more volatile than RTX AS. It trades about 0.02 of its potential returns per unit of risk. RTX AS is currently generating about -0.03 per unit of risk. If you would invest 242.00 in Stenocare AS on August 29, 2024 and sell it today you would lose (44.00) from holding Stenocare AS or give up 18.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stenocare AS vs. RTX AS
Performance |
| Timeline |
| Stenocare AS |
| RTX AS |
Stenocare and RTX AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stenocare and RTX AS
The main advantage of trading using opposite Stenocare and RTX AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stenocare position performs unexpectedly, RTX AS 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 RTX AS will offset losses from the drop in RTX AS's long position.| Stenocare vs. Strategic Investments AS | Stenocare vs. Kreditbanken AS | Stenocare vs. Nordea Bank Abp | Stenocare vs. Alefarm Brewing 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |