Correlation Between Sapporo Holdings and Carlsberg

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

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

Diversification Opportunities for Sapporo Holdings and Carlsberg

-0.4

Correlation Coefficient

Sapporo Holdings  Carlsberg

Very good diversification

The 3 months correlation between Sapporo and Carlsberg is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Sapporo Holdings Limited and Carlsberg AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlsberg AS and Sapporo Holdings 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 Sapporo Holdings Limited are associated (or correlated) with Carlsberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlsberg AS has no effect on the direction of Sapporo Holdings i.e., Sapporo Holdings and Carlsberg go up and down completely randomly.

Pair Corralation between Sapporo Holdings and Carlsberg

If you would invest  2,554  in Sapporo Holdings Limited on September 25, 2024 and sell it today you would earn a total of  0.00  from holding Sapporo Holdings Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

Sapporo Holdings Limited  vs.  Carlsberg AS

Sapporo Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Carlsberg AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Carlsberg 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 technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Sapporo Holdings and Carlsberg

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

The idea behind Sapporo Holdings Limited and Carlsberg 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.