Correlation Between INTER CARS and SYSTEMAIR
Can any of the company-specific risk be diversified away by investing in both INTER CARS and SYSTEMAIR 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 INTER CARS and SYSTEMAIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and SYSTEMAIR AB, you can compare the effects of market volatilities on INTER CARS and SYSTEMAIR 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 INTER CARS with a short position of SYSTEMAIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and SYSTEMAIR.
Diversification Opportunities for INTER CARS and SYSTEMAIR
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between INTER and SYSTEMAIR is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and SYSTEMAIR AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SYSTEMAIR AB and INTER CARS 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 INTER CARS SA are associated (or correlated) with SYSTEMAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SYSTEMAIR AB has no effect on the direction of INTER CARS i.e., INTER CARS and SYSTEMAIR go up and down completely randomly.
Pair Corralation between INTER CARS and SYSTEMAIR
Assuming the 90 days horizon INTER CARS SA is expected to under-perform the SYSTEMAIR. But the stock apears to be less risky and, when comparing its historical volatility, INTER CARS SA is 1.69 times less risky than SYSTEMAIR. The stock trades about -0.02 of its potential returns per unit of risk. The SYSTEMAIR AB is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 558.00 in SYSTEMAIR AB on September 1, 2024 and sell it today you would earn a total of 224.00 from holding SYSTEMAIR AB or generate 40.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTER CARS SA vs. SYSTEMAIR AB
Performance |
| Timeline |
| INTER CARS SA |
| SYSTEMAIR AB |
INTER CARS and SYSTEMAIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and SYSTEMAIR
The main advantage of trading using opposite INTER CARS and SYSTEMAIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS position performs unexpectedly, SYSTEMAIR 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 SYSTEMAIR will offset losses from the drop in SYSTEMAIR's long position.| INTER CARS vs. Commercial Vehicle Group | INTER CARS vs. Zijin Mining Group | INTER CARS vs. GEELY AUTOMOBILE | INTER CARS vs. Grupo Carso SAB |
| SYSTEMAIR vs. CeoTronics AG | SYSTEMAIR vs. Check Point Software | SYSTEMAIR vs. Ares Management Corp | SYSTEMAIR vs. X Fab Silicon |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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