Correlation Between Federal Realty and METALL ZUG

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

Diversification Opportunities for Federal Realty and METALL ZUG

-0.41
  Correlation Coefficient

Very good diversification

The 3 months correlation between Federal and METALL is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Federal Realty Investment and METALL ZUG AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on METALL ZUG AG and Federal Realty 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 Federal Realty Investment are associated (or correlated) with METALL ZUG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of METALL ZUG AG has no effect on the direction of Federal Realty i.e., Federal Realty and METALL ZUG go up and down completely randomly.

Pair Corralation between Federal Realty and METALL ZUG

Assuming the 90 days trading horizon Federal Realty Investment is expected to generate 0.95 times more return on investment than METALL ZUG. However, Federal Realty Investment is 1.05 times less risky than METALL ZUG. It trades about 0.04 of its potential returns per unit of risk. METALL ZUG AG is currently generating about -0.08 per unit of risk. If you would invest  9,723  in Federal Realty Investment on September 12, 2024 and sell it today you would earn a total of  1,553  from holding Federal Realty Investment or generate 15.97% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy89.71%
ValuesDaily Returns

Federal Realty Investment  vs.  METALL ZUG AG

 Performance 
       Timeline  
Federal Realty Investment 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Federal Realty Investment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Federal Realty is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
METALL ZUG AG 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days METALL ZUG AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, METALL ZUG is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Federal Realty and METALL ZUG Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Federal Realty and METALL ZUG

The main advantage of trading using opposite Federal Realty and METALL ZUG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Realty position performs unexpectedly, METALL ZUG 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 METALL ZUG will offset losses from the drop in METALL ZUG's long position.
The idea behind Federal Realty Investment and METALL ZUG AG 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

Other Complementary Tools

Sign In To Macroaxis
Sign in to explore Macroaxis' wealth optimization platform and fintech modules
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories