Correlation Between Khiron Life and Scandinavian Tobacco
Can any of the company-specific risk be diversified away by investing in both Khiron Life and Scandinavian Tobacco 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 Khiron Life and Scandinavian Tobacco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Khiron Life Sciences and Scandinavian Tobacco Group, you can compare the effects of market volatilities on Khiron Life 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 Khiron Life with a short position of Scandinavian Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Khiron Life and Scandinavian Tobacco.
Diversification Opportunities for Khiron Life and Scandinavian Tobacco
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Khiron and Scandinavian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Khiron Life Sciences and Scandinavian Tobacco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandinavian Tobacco and Khiron Life 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 Khiron Life Sciences 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 Khiron Life i.e., Khiron Life and Scandinavian Tobacco go up and down completely randomly.
Pair Corralation between Khiron Life and Scandinavian Tobacco
Assuming the 90 days trading horizon Khiron Life is expected to generate 70.09 times less return on investment than Scandinavian Tobacco. But when comparing it to its historical volatility, Khiron Life Sciences is 1.29 times less risky than Scandinavian Tobacco. It trades about 0.0 of its potential returns per unit of risk. Scandinavian Tobacco Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 438.00 in Scandinavian Tobacco Group on September 23, 2024 and sell it today you would earn a total of 802.00 from holding Scandinavian Tobacco Group or generate 183.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
Khiron Life Sciences vs. Scandinavian Tobacco Group
Performance |
Timeline |
Khiron Life Sciences |
Scandinavian Tobacco |
Khiron Life and Scandinavian Tobacco Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Khiron Life and Scandinavian Tobacco
The main advantage of trading using opposite Khiron Life and Scandinavian Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Khiron Life 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.Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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