Correlation Between CONCORDIA FINL and SSE PLC
Can any of the company-specific risk be diversified away by investing in both CONCORDIA FINL and SSE PLC 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 CONCORDIA FINL and SSE PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CONCORDIA FINL GROUP and SSE PLC ADR, you can compare the effects of market volatilities on CONCORDIA FINL and SSE PLC 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 CONCORDIA FINL with a short position of SSE PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of CONCORDIA FINL and SSE PLC.
Diversification Opportunities for CONCORDIA FINL and SSE PLC
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CONCORDIA and SSE is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding CONCORDIA FINL GROUP and SSE PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSE PLC ADR and CONCORDIA FINL 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 CONCORDIA FINL GROUP are associated (or correlated) with SSE PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSE PLC ADR has no effect on the direction of CONCORDIA FINL i.e., CONCORDIA FINL and SSE PLC go up and down completely randomly.
Pair Corralation between CONCORDIA FINL and SSE PLC
Assuming the 90 days horizon CONCORDIA FINL GROUP is expected to generate 1.12 times more return on investment than SSE PLC. However, CONCORDIA FINL is 1.12 times more volatile than SSE PLC ADR. It trades about 0.04 of its potential returns per unit of risk. SSE PLC ADR is currently generating about -0.08 per unit of risk. If you would invest 530.00 in CONCORDIA FINL GROUP on October 20, 2024 and sell it today you would earn a total of 5.00 from holding CONCORDIA FINL GROUP or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
CONCORDIA FINL GROUP vs. SSE PLC ADR
Performance |
| Timeline |
| CONCORDIA FINL GROUP |
| SSE PLC ADR |
CONCORDIA FINL and SSE PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CONCORDIA FINL and SSE PLC
The main advantage of trading using opposite CONCORDIA FINL and SSE PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CONCORDIA FINL position performs unexpectedly, SSE PLC 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 SSE PLC will offset losses from the drop in SSE PLC's long position.| CONCORDIA FINL vs. China Merchants Bank | CONCORDIA FINL vs. HDFC Bank Limited | CONCORDIA FINL vs. ICICI Bank Limited | CONCORDIA FINL vs. PT Bank Central |
| SSE PLC vs. IBERDROLA ADR1 EO | SSE PLC vs. C PARAN EN | SSE PLC vs. CIA ENGER ADR | SSE PLC vs. Companhia Energtica de |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |