Correlation Between Thyssenkrupp and Seraphim Space
Can any of the company-specific risk be diversified away by investing in both Thyssenkrupp and Seraphim Space 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 Thyssenkrupp and Seraphim Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thyssenkrupp AG ON and Seraphim Space Investment, you can compare the effects of market volatilities on Thyssenkrupp and Seraphim Space 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 Thyssenkrupp with a short position of Seraphim Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thyssenkrupp and Seraphim Space.
Diversification Opportunities for Thyssenkrupp and Seraphim Space
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Thyssenkrupp and Seraphim is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Thyssenkrupp AG ON and Seraphim Space Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seraphim Space Investment and Thyssenkrupp 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 Thyssenkrupp AG ON are associated (or correlated) with Seraphim Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seraphim Space Investment has no effect on the direction of Thyssenkrupp i.e., Thyssenkrupp and Seraphim Space go up and down completely randomly.
Pair Corralation between Thyssenkrupp and Seraphim Space
Assuming the 90 days trading horizon Thyssenkrupp AG ON is expected to generate 0.96 times more return on investment than Seraphim Space. However, Thyssenkrupp AG ON is 1.04 times less risky than Seraphim Space. It trades about 0.21 of its potential returns per unit of risk. Seraphim Space Investment is currently generating about -0.12 per unit of risk. If you would invest 389.00 in Thyssenkrupp AG ON on October 24, 2024 and sell it today you would earn a total of 27.00 from holding Thyssenkrupp AG ON or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thyssenkrupp AG ON vs. Seraphim Space Investment
Performance |
| Timeline |
| Thyssenkrupp AG ON |
| Seraphim Space Investment |
Thyssenkrupp and Seraphim Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thyssenkrupp and Seraphim Space
The main advantage of trading using opposite Thyssenkrupp and Seraphim Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thyssenkrupp position performs unexpectedly, Seraphim Space 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 Seraphim Space will offset losses from the drop in Seraphim Space's long position.| Thyssenkrupp vs. Home Depot | Thyssenkrupp vs. Weiss Korea Opportunity | Thyssenkrupp vs. River and Mercantile | Thyssenkrupp vs. Chrysalis Investments |
| Seraphim Space vs. Vitec Software Group | Seraphim Space vs. Xeros Technology Group | Seraphim Space vs. Verizon Communications | Seraphim Space vs. Gamma Communications PLC |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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