Correlation Between SIVERS SEMICONDUCTORS and Metro AG
Can any of the company-specific risk be diversified away by investing in both SIVERS SEMICONDUCTORS and Metro AG 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 SIVERS SEMICONDUCTORS and Metro AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIVERS SEMICONDUCTORS AB and Metro AG, you can compare the effects of market volatilities on SIVERS SEMICONDUCTORS and Metro AG 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 SIVERS SEMICONDUCTORS with a short position of Metro AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIVERS SEMICONDUCTORS and Metro AG.
Diversification Opportunities for SIVERS SEMICONDUCTORS and Metro AG
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SIVERS and Metro is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding SIVERS SEMICONDUCTORS AB and Metro AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro AG and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS AB are associated (or correlated) with Metro AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro AG has no effect on the direction of SIVERS SEMICONDUCTORS i.e., SIVERS SEMICONDUCTORS and Metro AG go up and down completely randomly.
Pair Corralation between SIVERS SEMICONDUCTORS and Metro AG
Assuming the 90 days horizon SIVERS SEMICONDUCTORS AB is expected to generate 2.71 times more return on investment than Metro AG. However, SIVERS SEMICONDUCTORS is 2.71 times more volatile than Metro AG. It trades about 0.0 of its potential returns per unit of risk. Metro AG is currently generating about -0.06 per unit of risk. If you would invest 54.00 in SIVERS SEMICONDUCTORS AB on September 19, 2024 and sell it today you would lose (29.00) from holding SIVERS SEMICONDUCTORS AB or give up 53.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIVERS SEMICONDUCTORS AB vs. Metro AG
Performance |
| Timeline |
| SIVERS SEMICONDUCTORS |
| Metro AG |
SIVERS SEMICONDUCTORS and Metro AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIVERS SEMICONDUCTORS and Metro AG
The main advantage of trading using opposite SIVERS SEMICONDUCTORS and Metro AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIVERS SEMICONDUCTORS position performs unexpectedly, Metro AG 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 Metro AG will offset losses from the drop in Metro AG's long position.| SIVERS SEMICONDUCTORS vs. Taiwan Semiconductor Manufacturing | SIVERS SEMICONDUCTORS vs. Broadcom | SIVERS SEMICONDUCTORS vs. Superior Plus Corp | SIVERS SEMICONDUCTORS vs. Norsk Hydro ASA |
| Metro AG vs. Metro AG | Metro AG vs. Superior Plus Corp | Metro AG vs. SIVERS SEMICONDUCTORS AB | Metro AG vs. NorAm Drilling AS |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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