Correlation Between Fluoguide and Scandion Oncology

Can any of the company-specific risk be diversified away by investing in both Fluoguide and Scandion Oncology 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 Fluoguide and Scandion Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fluoguide AS and Scandion Oncology AS, you can compare the effects of market volatilities on Fluoguide and Scandion Oncology 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 Fluoguide with a short position of Scandion Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fluoguide and Scandion Oncology.

Diversification Opportunities for Fluoguide and Scandion Oncology

0.56

Correlation Coefficient

Fluoguide  Scandion Oncology

Very weak diversification

The 3 months correlation between Fluoguide and Scandion is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Fluoguide AS and Scandion Oncology AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandion Oncology and Fluoguide 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 Fluoguide AS are associated (or correlated) with Scandion Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandion Oncology has no effect on the direction of Fluoguide i.e., Fluoguide and Scandion Oncology go up and down completely randomly.

Pair Corralation between Fluoguide and Scandion Oncology

Assuming the 90 days trading horizon Fluoguide AS is expected to generate 0.57 times more return on investment than Scandion Oncology. However, Fluoguide AS is 1.75 times less risky than Scandion Oncology. It trades about 0.05 of its potential returns per unit of risk. Scandion Oncology AS is currently generating about -0.13 per unit of risk. If you would invest  3,915  in Fluoguide AS on September 12, 2024 and sell it today you would earn a total of  310.00  from holding Fluoguide AS or generate 7.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Fluoguide AS  vs.  Scandion Oncology AS

Fluoguide AS

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Fluoguide AS are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Fluoguide may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Scandion Oncology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Scandion Oncology AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Fluoguide and Scandion Oncology

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

The idea behind Fluoguide AS and Scandion Oncology AS 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.