Correlation Between Scientific Games and Powercell Sweden
Can any of the company-specific risk be diversified away by investing in both Scientific Games and Powercell Sweden 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 Scientific Games and Powercell Sweden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scientific Games and Powercell Sweden, you can compare the effects of market volatilities on Scientific Games and Powercell Sweden 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 Scientific Games with a short position of Powercell Sweden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scientific Games and Powercell Sweden.
Diversification Opportunities for Scientific Games and Powercell Sweden
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Scientific and Powercell is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Scientific Games and Powercell Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powercell Sweden and Scientific Games 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 Scientific Games are associated (or correlated) with Powercell Sweden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powercell Sweden has no effect on the direction of Scientific Games i.e., Scientific Games and Powercell Sweden go up and down completely randomly.
Pair Corralation between Scientific Games and Powercell Sweden
Assuming the 90 days horizon Scientific Games is expected to under-perform the Powercell Sweden. But the stock apears to be less risky and, when comparing its historical volatility, Scientific Games is 1.37 times less risky than Powercell Sweden. The stock trades about -0.16 of its potential returns per unit of risk. The Powercell Sweden is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 328.00 in Powercell Sweden on October 11, 2024 and sell it today you would earn a total of 0.00 from holding Powercell Sweden 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 |
Scientific Games vs. Powercell Sweden
Performance |
| Timeline |
| Scientific Games |
| Powercell Sweden |
Scientific Games and Powercell Sweden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scientific Games and Powercell Sweden
The main advantage of trading using opposite Scientific Games and Powercell Sweden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scientific Games position performs unexpectedly, Powercell Sweden 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 Powercell Sweden will offset losses from the drop in Powercell Sweden's long position.| Scientific Games vs. Highlight Communications AG | Scientific Games vs. Charter Communications | Scientific Games vs. SK TELECOM TDADR | Scientific Games vs. TOMBADOR IRON LTD |
| Powercell Sweden vs. INDO RAMA SYNTHETIC | Powercell Sweden vs. CHEMICAL INDUSTRIES | Powercell Sweden vs. X FAB Silicon Foundries | Powercell Sweden vs. Laureate Education |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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