Correlation Between Prosafe SE and SIEMENS ENERGY
Can any of the company-specific risk be diversified away by investing in both Prosafe SE and SIEMENS ENERGY 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 Prosafe SE and SIEMENS ENERGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prosafe SE and SIEMENS ENERGY AG, you can compare the effects of market volatilities on Prosafe SE and SIEMENS ENERGY 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 Prosafe SE with a short position of SIEMENS ENERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prosafe SE and SIEMENS ENERGY.
Diversification Opportunities for Prosafe SE and SIEMENS ENERGY
-0.95 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Prosafe and SIEMENS is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding Prosafe SE and SIEMENS ENERGY AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIEMENS ENERGY AG and Prosafe SE 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 Prosafe SE are associated (or correlated) with SIEMENS ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIEMENS ENERGY AG has no effect on the direction of Prosafe SE i.e., Prosafe SE and SIEMENS ENERGY go up and down completely randomly.
Pair Corralation between Prosafe SE and SIEMENS ENERGY
Assuming the 90 days horizon Prosafe SE is expected to under-perform the SIEMENS ENERGY. In addition to that, Prosafe SE is 2.42 times more volatile than SIEMENS ENERGY AG. It trades about -0.56 of its total potential returns per unit of risk. SIEMENS ENERGY AG is currently generating about 0.44 per unit of volatility. If you would invest 3,680 in SIEMENS ENERGY AG on August 29, 2024 and sell it today you would earn a total of 1,280 from holding SIEMENS ENERGY AG or generate 34.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prosafe SE vs. SIEMENS ENERGY AG
Performance |
| Timeline |
| Prosafe SE |
| SIEMENS ENERGY AG |
Prosafe SE and SIEMENS ENERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prosafe SE and SIEMENS ENERGY
The main advantage of trading using opposite Prosafe SE and SIEMENS ENERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prosafe SE position performs unexpectedly, SIEMENS ENERGY 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 SIEMENS ENERGY will offset losses from the drop in SIEMENS ENERGY's long position.| Prosafe SE vs. Scientific Games | Prosafe SE vs. HEALTHCARE REAL A | Prosafe SE vs. OURGAME INTHOLDL 00005 | Prosafe SE vs. Hochschild Mining plc |
| SIEMENS ENERGY vs. CN YANGTPWR GDR | SIEMENS ENERGY vs. Datang International Power | SIEMENS ENERGY vs. Superior Plus Corp | SIEMENS ENERGY vs. SIVERS SEMICONDUCTORS AB |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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