Correlation Between ACCO Brands and SCANDMEDICAL SOLDK-040

Can any of the company-specific risk be diversified away by investing in both ACCO Brands and SCANDMEDICAL SOLDK-040 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 ACCO Brands and SCANDMEDICAL SOLDK-040 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ACCO Brands and SCANDMEDICAL SOLDK 040, you can compare the effects of market volatilities on ACCO Brands and SCANDMEDICAL SOLDK-040 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 ACCO Brands with a short position of SCANDMEDICAL SOLDK-040. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACCO Brands and SCANDMEDICAL SOLDK-040.

Diversification Opportunities for ACCO Brands and SCANDMEDICAL SOLDK-040

0.08

Correlation Coefficient

ACCO Brands  SCANDMEDICAL SOLDK-040

Significant diversification

The 3 months correlation between ACCO and SCANDMEDICAL is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding ACCO Brands and SCANDMEDICAL SOLDK 040 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCANDMEDICAL SOLDK 040 and ACCO Brands 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 ACCO Brands are associated (or correlated) with SCANDMEDICAL SOLDK-040. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCANDMEDICAL SOLDK 040 has no effect on the direction of ACCO Brands i.e., ACCO Brands and SCANDMEDICAL SOLDK-040 go up and down completely randomly.

Pair Corralation between ACCO Brands and SCANDMEDICAL SOLDK-040

Assuming the 90 days horizon ACCO Brands is expected to under-perform the SCANDMEDICAL SOLDK-040. But the stock apears to be less risky and, when comparing its historical volatility, ACCO Brands is 1.32 times less risky than SCANDMEDICAL SOLDK-040. The stock trades about -0.65 of its potential returns per unit of risk. The SCANDMEDICAL SOLDK 040 is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  77.00  in SCANDMEDICAL SOLDK 040 on October 8, 2024 and sell it today you would lose (1.00) from holding SCANDMEDICAL SOLDK 040 or give up 1.3% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ACCO Brands  vs.  SCANDMEDICAL SOLDK 040

ACCO Brands

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ACCO Brands are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ACCO Brands may actually be approaching a critical reversion point that can send shares even higher in February 2025.

SCANDMEDICAL SOLDK 040

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SCANDMEDICAL SOLDK 040 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SCANDMEDICAL SOLDK-040 is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ACCO Brands and SCANDMEDICAL SOLDK-040

The main advantage of trading using opposite ACCO Brands and SCANDMEDICAL SOLDK-040 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACCO Brands position performs unexpectedly, SCANDMEDICAL SOLDK-040 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 SCANDMEDICAL SOLDK-040 will offset losses from the drop in SCANDMEDICAL SOLDK-040's long position.

The idea behind ACCO Brands and SCANDMEDICAL SOLDK 040 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 CEOs Directory module to screen CEOs from public companies around the world.