Correlation Between Strategic Investments and Scandinavian Investment
Can any of the company-specific risk be diversified away by investing in both Strategic Investments and Scandinavian Investment 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 Strategic Investments and Scandinavian Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Investments AS and Scandinavian Investment Group, you can compare the effects of market volatilities on Strategic Investments and Scandinavian Investment 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 Strategic Investments with a short position of Scandinavian Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Investments and Scandinavian Investment.
Diversification Opportunities for Strategic Investments and Scandinavian Investment
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Strategic and Scandinavian is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Investments AS and Scandinavian Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Investment and Strategic Investments 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 Strategic Investments AS are associated (or correlated) with Scandinavian Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Investment has no effect on the direction of Strategic Investments i.e., Strategic Investments and Scandinavian Investment go up and down completely randomly.
Pair Corralation between Strategic Investments and Scandinavian Investment
Assuming the 90 days trading horizon Strategic Investments AS is expected to under-perform the Scandinavian Investment. In addition to that, Strategic Investments is 1.46 times more volatile than Scandinavian Investment Group. It trades about -0.08 of its total potential returns per unit of risk. Scandinavian Investment Group is currently generating about 0.03 per unit of volatility. If you would invest 326.00 in Scandinavian Investment Group on August 31, 2024 and sell it today you would earn a total of 2.00 from holding Scandinavian Investment Group or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Strategic Investments AS vs. Scandinavian Investment Group
Performance |
| Timeline |
| Strategic Investments |
| Scandinavian Investment |
Strategic Investments and Scandinavian Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Investments and Scandinavian Investment
The main advantage of trading using opposite Strategic Investments and Scandinavian Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Investments position performs unexpectedly, Scandinavian Investment 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 Scandinavian Investment will offset losses from the drop in Scandinavian Investment's long position.| Strategic Investments vs. Newcap Holding AS | Strategic Investments vs. SKAKO AS | Strategic Investments vs. Rovsing AS |
| Scandinavian Investment vs. North Media AS | Scandinavian Investment vs. Rovsing AS | Scandinavian Investment vs. Alm Brand | Scandinavian Investment vs. SKAKO 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |