Correlation Between Alfa Financial and PEH WERTPAPIER
Can any of the company-specific risk be diversified away by investing in both Alfa Financial and PEH WERTPAPIER 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 Alfa Financial and PEH WERTPAPIER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Financial Software and PEH WERTPAPIER, you can compare the effects of market volatilities on Alfa Financial and PEH WERTPAPIER 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 Alfa Financial with a short position of PEH WERTPAPIER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and PEH WERTPAPIER.
Diversification Opportunities for Alfa Financial and PEH WERTPAPIER
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alfa and PEH is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and PEH WERTPAPIER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEH WERTPAPIER and Alfa Financial 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 Alfa Financial Software are associated (or correlated) with PEH WERTPAPIER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEH WERTPAPIER has no effect on the direction of Alfa Financial i.e., Alfa Financial and PEH WERTPAPIER go up and down completely randomly.
Pair Corralation between Alfa Financial and PEH WERTPAPIER
Assuming the 90 days trading horizon Alfa Financial Software is expected to generate 1.69 times more return on investment than PEH WERTPAPIER. However, Alfa Financial is 1.69 times more volatile than PEH WERTPAPIER. It trades about 0.16 of its potential returns per unit of risk. PEH WERTPAPIER is currently generating about 0.06 per unit of risk. If you would invest 252.00 in Alfa Financial Software on September 13, 2024 and sell it today you would earn a total of 20.00 from holding Alfa Financial Software or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Alfa Financial Software vs. PEH WERTPAPIER
Performance |
| Timeline |
| Alfa Financial Software |
| PEH WERTPAPIER |
Alfa Financial and PEH WERTPAPIER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfa Financial and PEH WERTPAPIER
The main advantage of trading using opposite Alfa Financial and PEH WERTPAPIER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Financial position performs unexpectedly, PEH WERTPAPIER 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 PEH WERTPAPIER will offset losses from the drop in PEH WERTPAPIER's long position.| Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc |
| PEH WERTPAPIER vs. SHIP HEALTHCARE HLDGINC | PEH WERTPAPIER vs. Ross Stores | PEH WERTPAPIER vs. Fast Retailing Co | PEH WERTPAPIER vs. FEMALE HEALTH |
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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