Correlation Between Superior Plus and FlatexDEGIRO
Can any of the company-specific risk be diversified away by investing in both Superior Plus and FlatexDEGIRO 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 Superior Plus and FlatexDEGIRO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and flatexDEGIRO AG, you can compare the effects of market volatilities on Superior Plus and FlatexDEGIRO 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 Superior Plus with a short position of FlatexDEGIRO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and FlatexDEGIRO.
Diversification Opportunities for Superior Plus and FlatexDEGIRO
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Superior and FlatexDEGIRO is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and flatexDEGIRO AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on flatexDEGIRO AG and Superior Plus 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 Superior Plus Corp are associated (or correlated) with FlatexDEGIRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of flatexDEGIRO AG has no effect on the direction of Superior Plus i.e., Superior Plus and FlatexDEGIRO go up and down completely randomly.
Pair Corralation between Superior Plus and FlatexDEGIRO
Assuming the 90 days horizon Superior Plus Corp is expected to generate 3.69 times more return on investment than FlatexDEGIRO. However, Superior Plus is 3.69 times more volatile than flatexDEGIRO AG. It trades about 0.03 of its potential returns per unit of risk. flatexDEGIRO AG is currently generating about 0.06 per unit of risk. If you would invest 414.00 in Superior Plus Corp on August 30, 2024 and sell it today you would earn a total of 2.00 from holding Superior Plus Corp or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. flatexDEGIRO AG
Performance |
| Timeline |
| Superior Plus Corp |
| flatexDEGIRO AG |
Superior Plus and FlatexDEGIRO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and FlatexDEGIRO
The main advantage of trading using opposite Superior Plus and FlatexDEGIRO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, FlatexDEGIRO 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 FlatexDEGIRO will offset losses from the drop in FlatexDEGIRO's long position.| Superior Plus vs. HYDROFARM HLD GRP | Superior Plus vs. Titan Machinery | Superior Plus vs. GOODYEAR T RUBBER | Superior Plus vs. Sterling Construction |
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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