Correlation Between Swedish Match and Nomura Holdings
Can any of the company-specific risk be diversified away by investing in both Swedish Match and Nomura Holdings 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 Swedish Match and Nomura Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swedish Match Ab and Nomura Holdings ADR, you can compare the effects of market volatilities on Swedish Match and Nomura Holdings 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 Swedish Match with a short position of Nomura Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swedish Match and Nomura Holdings.
Diversification Opportunities for Swedish Match and Nomura Holdings
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swedish and Nomura is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Swedish Match Ab and Nomura Holdings ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nomura Holdings ADR and Swedish Match 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 Swedish Match Ab are associated (or correlated) with Nomura Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nomura Holdings ADR has no effect on the direction of Swedish Match i.e., Swedish Match and Nomura Holdings go up and down completely randomly.
Pair Corralation between Swedish Match and Nomura Holdings
If you would invest 619.00 in Nomura Holdings ADR on September 3, 2024 and sell it today you would lose (2.00) from holding Nomura Holdings ADR or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Swedish Match Ab vs. Nomura Holdings ADR
Performance |
| Timeline |
| Swedish Match Ab |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nomura Holdings ADR |
Swedish Match and Nomura Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swedish Match and Nomura Holdings
The main advantage of trading using opposite Swedish Match and Nomura Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swedish Match position performs unexpectedly, Nomura Holdings 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 Nomura Holdings will offset losses from the drop in Nomura Holdings' long position.| Swedish Match vs. Steven Madden | Swedish Match vs. Fevertree Drinks Plc | Swedish Match vs. Canlan Ice Sports | Swedish Match vs. Xponential Fitness |
| Nomura Holdings vs. Perella Weinberg Partners | Nomura Holdings vs. Oppenheimer Holdings | Nomura Holdings vs. Stifel Financial Corp | Nomura Holdings vs. Piper Sandler Companies |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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