Correlation Between Duni AB and Candles Scandinavia

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Duni AB and Candles Scandinavia 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 Duni AB and Candles Scandinavia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duni AB and Candles Scandinavia AB, you can compare the effects of market volatilities on Duni AB and Candles Scandinavia 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 Duni AB with a short position of Candles Scandinavia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duni AB and Candles Scandinavia.

Diversification Opportunities for Duni AB and Candles Scandinavia

-0.51
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Duni and Candles is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Duni AB and Candles Scandinavia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Candles Scandinavia and Duni AB 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 Duni AB are associated (or correlated) with Candles Scandinavia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Candles Scandinavia has no effect on the direction of Duni AB i.e., Duni AB and Candles Scandinavia go up and down completely randomly.

Pair Corralation between Duni AB and Candles Scandinavia

Assuming the 90 days trading horizon Duni AB is expected to under-perform the Candles Scandinavia. But the stock apears to be less risky and, when comparing its historical volatility, Duni AB is 2.37 times less risky than Candles Scandinavia. The stock trades about -0.09 of its potential returns per unit of risk. The Candles Scandinavia AB is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,970  in Candles Scandinavia AB on September 5, 2024 and sell it today you would earn a total of  360.00  from holding Candles Scandinavia AB or generate 18.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy98.46%
ValuesDaily Returns

Duni AB  vs.  Candles Scandinavia AB

 Performance 
       Timeline  
Duni AB 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Duni AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
Candles Scandinavia 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Candles Scandinavia AB are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain essential indicators, Candles Scandinavia sustained solid returns over the last few months and may actually be approaching a breakup point.

Duni AB and Candles Scandinavia Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Duni AB and Candles Scandinavia

The main advantage of trading using opposite Duni AB and Candles Scandinavia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duni AB position performs unexpectedly, Candles Scandinavia 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 Candles Scandinavia will offset losses from the drop in Candles Scandinavia's long position.
The idea behind Duni AB and Candles Scandinavia AB 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.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

Other Complementary Tools

Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments