Correlation Between Traton SE and Daimler Truck
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By analyzing existing cross correlation between Traton SE and Daimler Truck Holding, you can compare the effects of market volatilities on Traton SE and Daimler Truck 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 Traton SE with a short position of Daimler Truck. Check out your portfolio center. Please also check ongoing floating volatility patterns of Traton SE and Daimler Truck.
Diversification Opportunities for Traton SE and Daimler Truck
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Traton and Daimler is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Traton SE and Daimler Truck Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daimler Truck Holding and Traton 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 Traton SE are associated (or correlated) with Daimler Truck. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daimler Truck Holding has no effect on the direction of Traton SE i.e., Traton SE and Daimler Truck go up and down completely randomly.
Pair Corralation between Traton SE and Daimler Truck
Assuming the 90 days trading horizon Traton SE is expected to generate 1.08 times more return on investment than Daimler Truck. However, Traton SE is 1.08 times more volatile than Daimler Truck Holding. It trades about 0.09 of its potential returns per unit of risk. Daimler Truck Holding is currently generating about 0.04 per unit of risk. If you would invest 1,382 in Traton SE on August 31, 2024 and sell it today you would earn a total of 1,493 from holding Traton SE or generate 108.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Traton SE vs. Daimler Truck Holding
Performance |
| Timeline |
| Traton SE |
| Daimler Truck Holding |
Traton SE and Daimler Truck Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Traton SE and Daimler Truck
The main advantage of trading using opposite Traton SE and Daimler Truck positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Traton SE position performs unexpectedly, Daimler Truck 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 Daimler Truck will offset losses from the drop in Daimler Truck's long position.| Traton SE vs. Norwegian Air Shuttle | Traton SE vs. WIZZ AIR HLDGUNSPADR4 | Traton SE vs. Harmony Gold Mining | Traton SE vs. Major Drilling Group |
| Daimler Truck vs. SBI Insurance Group | Daimler Truck vs. Direct Line Insurance | Daimler Truck vs. REVO INSURANCE SPA | Daimler Truck vs. HANOVER INSURANCE |
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 Stocks Directory module to find actively traded stocks across global markets.
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