Correlation Between Materialise and United Internet
Can any of the company-specific risk be diversified away by investing in both Materialise and United Internet 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 Materialise and United Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Materialise NV and United Internet AG, you can compare the effects of market volatilities on Materialise and United Internet 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 Materialise with a short position of United Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materialise and United Internet.
Diversification Opportunities for Materialise and United Internet
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Materialise and United is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Materialise NV and United Internet AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Internet AG and Materialise 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 Materialise NV are associated (or correlated) with United Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Internet AG has no effect on the direction of Materialise i.e., Materialise and United Internet go up and down completely randomly.
Pair Corralation between Materialise and United Internet
Assuming the 90 days trading horizon Materialise NV is expected to generate 1.07 times more return on investment than United Internet. However, Materialise is 1.07 times more volatile than United Internet AG. It trades about 0.33 of its potential returns per unit of risk. United Internet AG is currently generating about -0.24 per unit of risk. If you would invest 555.00 in Materialise NV on September 5, 2024 and sell it today you would earn a total of 165.00 from holding Materialise NV or generate 29.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Materialise NV vs. United Internet AG
Performance |
| Timeline |
| Materialise NV |
| United Internet AG |
Materialise and United Internet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Materialise and United Internet
The main advantage of trading using opposite Materialise and United Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materialise position performs unexpectedly, United Internet 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 United Internet will offset losses from the drop in United Internet's long position.| Materialise vs. Warner Music Group | Materialise vs. Meli Hotels International | Materialise vs. VARIOUS EATERIES LS | Materialise vs. Host Hotels Resorts |
| United Internet vs. Air New Zealand | United Internet vs. Materialise NV | United Internet vs. FORWARD AIR P | United Internet vs. Fair Isaac Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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