Correlation Between BAIDU and Scandinavian Tobacco
Specify exactly 2 symbols:
By analyzing existing cross correlation between BAIDU INC 4125 and Scandinavian Tobacco Group, you can compare the effects of market volatilities on BAIDU and Scandinavian Tobacco 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 BAIDU with a short position of Scandinavian Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of BAIDU and Scandinavian Tobacco.
Diversification Opportunities for BAIDU and Scandinavian Tobacco
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BAIDU and Scandinavian is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding BAIDU INC 4125 and Scandinavian Tobacco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Tobacco and BAIDU 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 BAIDU INC 4125 are associated (or correlated) with Scandinavian Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandinavian Tobacco has no effect on the direction of BAIDU i.e., BAIDU and Scandinavian Tobacco go up and down completely randomly.
Pair Corralation between BAIDU and Scandinavian Tobacco
Assuming the 90 days trading horizon BAIDU INC 4125 is expected to generate 61.09 times more return on investment than Scandinavian Tobacco. However, BAIDU is 61.09 times more volatile than Scandinavian Tobacco Group. It trades about 0.1 of its potential returns per unit of risk. Scandinavian Tobacco Group is currently generating about 0.02 per unit of risk. If you would invest 9,719 in BAIDU INC 4125 on September 2, 2024 and sell it today you would earn a total of 140.00 from holding BAIDU INC 4125 or generate 1.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 21.18% |
| Values | Daily Returns |
BAIDU INC 4125 vs. Scandinavian Tobacco Group
Performance |
| Timeline |
| BAIDU INC 4125 |
| Scandinavian Tobacco |
BAIDU and Scandinavian Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BAIDU and Scandinavian Tobacco
The main advantage of trading using opposite BAIDU and Scandinavian Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BAIDU position performs unexpectedly, Scandinavian Tobacco 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 Tobacco will offset losses from the drop in Scandinavian Tobacco's long position.| BAIDU vs. National Beverage Corp | BAIDU vs. Tower One Wireless | BAIDU vs. Brandywine Realty Trust | BAIDU vs. The Coca Cola |
| Scandinavian Tobacco vs. Universal | Scandinavian Tobacco vs. Imperial Brands PLC | Scandinavian Tobacco vs. Japan Tobacco ADR | Scandinavian Tobacco vs. Philip Morris International |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |