Correlation Between Schweiter Technologies and Concurrent Technologies
Can any of the company-specific risk be diversified away by investing in both Schweiter Technologies and Concurrent Technologies 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 Schweiter Technologies and Concurrent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweiter Technologies AG and Concurrent Technologies Plc, you can compare the effects of market volatilities on Schweiter Technologies and Concurrent Technologies 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 Schweiter Technologies with a short position of Concurrent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweiter Technologies and Concurrent Technologies.
Diversification Opportunities for Schweiter Technologies and Concurrent Technologies
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Schweiter and Concurrent is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Schweiter Technologies AG and Concurrent Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concurrent Technologies and Schweiter Technologies 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 Schweiter Technologies AG are associated (or correlated) with Concurrent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concurrent Technologies has no effect on the direction of Schweiter Technologies i.e., Schweiter Technologies and Concurrent Technologies go up and down completely randomly.
Pair Corralation between Schweiter Technologies and Concurrent Technologies
Assuming the 90 days trading horizon Schweiter Technologies AG is expected to under-perform the Concurrent Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Schweiter Technologies AG is 1.1 times less risky than Concurrent Technologies. The stock trades about -0.03 of its potential returns per unit of risk. The Concurrent Technologies Plc is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 7,111 in Concurrent Technologies Plc on September 2, 2024 and sell it today you would earn a total of 7,289 from holding Concurrent Technologies Plc or generate 102.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Schweiter Technologies AG vs. Concurrent Technologies Plc
Performance |
| Timeline |
| Schweiter Technologies |
| Concurrent Technologies |
Schweiter Technologies and Concurrent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schweiter Technologies and Concurrent Technologies
The main advantage of trading using opposite Schweiter Technologies and Concurrent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweiter Technologies position performs unexpectedly, Concurrent Technologies 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 Concurrent Technologies will offset losses from the drop in Concurrent Technologies' long position.| Schweiter Technologies vs. Charter Communications Cl | Schweiter Technologies vs. Naturhouse Health SA | Schweiter Technologies vs. Aeorema Communications Plc | Schweiter Technologies vs. Abingdon Health Plc |
| Concurrent Technologies vs. Naturhouse Health SA | Concurrent Technologies vs. Hilton Food Group | Concurrent Technologies vs. Axfood AB | Concurrent Technologies vs. Worldwide Healthcare Trust |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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