Correlation Between Stevanato Group and Toro
Can any of the company-specific risk be diversified away by investing in both Stevanato Group and Toro 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 Stevanato Group and Toro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stevanato Group SpA and Toro Co, you can compare the effects of market volatilities on Stevanato Group and Toro 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 Stevanato Group with a short position of Toro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stevanato Group and Toro.
Diversification Opportunities for Stevanato Group and Toro
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Stevanato and Toro is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Stevanato Group SpA and Toro Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toro and Stevanato 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 Stevanato Group SpA are associated (or correlated) with Toro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toro has no effect on the direction of Stevanato Group i.e., Stevanato Group and Toro go up and down completely randomly.
Pair Corralation between Stevanato Group and Toro
Given the investment horizon of 90 days Stevanato Group SpA is expected to under-perform the Toro. In addition to that, Stevanato Group is 1.72 times more volatile than Toro Co. It trades about -0.02 of its total potential returns per unit of risk. Toro Co is currently generating about 0.02 per unit of volatility. If you would invest 8,261 in Toro Co on September 1, 2024 and sell it today you would earn a total of 447.00 from holding Toro Co or generate 5.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stevanato Group SpA vs. Toro Co
Performance |
| Timeline |
| Stevanato Group SpA |
| Toro |
Stevanato Group and Toro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stevanato Group and Toro
The main advantage of trading using opposite Stevanato Group and Toro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stevanato Group position performs unexpectedly, Toro 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 Toro will offset losses from the drop in Toro's long position.| Stevanato Group vs. Haemonetics | Stevanato Group vs. Merit Medical Systems | Stevanato Group vs. AngioDynamics | Stevanato Group vs. AptarGroup |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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