Correlation Between Austriacard Holdings and Lanakam SA
Can any of the company-specific risk be diversified away by investing in both Austriacard Holdings and Lanakam SA 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 Austriacard Holdings and Lanakam SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austriacard Holdings AG and Lanakam SA, you can compare the effects of market volatilities on Austriacard Holdings and Lanakam SA 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 Austriacard Holdings with a short position of Lanakam SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austriacard Holdings and Lanakam SA.
Diversification Opportunities for Austriacard Holdings and Lanakam SA
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Austriacard and Lanakam is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Austriacard Holdings AG and Lanakam SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanakam SA and Austriacard Holdings 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 Austriacard Holdings AG are associated (or correlated) with Lanakam SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanakam SA has no effect on the direction of Austriacard Holdings i.e., Austriacard Holdings and Lanakam SA go up and down completely randomly.
Pair Corralation between Austriacard Holdings and Lanakam SA
Assuming the 90 days trading horizon Austriacard Holdings is expected to generate 1.4 times less return on investment than Lanakam SA. But when comparing it to its historical volatility, Austriacard Holdings AG is 1.74 times less risky than Lanakam SA. It trades about 0.01 of its potential returns per unit of risk. Lanakam SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 91.00 in Lanakam SA on September 19, 2024 and sell it today you would lose (1.00) from holding Lanakam SA or give up 1.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Austriacard Holdings AG vs. Lanakam SA
Performance |
| Timeline |
| Austriacard Holdings |
| Lanakam SA |
Austriacard Holdings and Lanakam SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Austriacard Holdings and Lanakam SA
The main advantage of trading using opposite Austriacard Holdings and Lanakam SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austriacard Holdings position performs unexpectedly, Lanakam SA 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 Lanakam SA will offset losses from the drop in Lanakam SA's long position.The idea behind Austriacard Holdings AG and Lanakam SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Lanakam SA vs. Bioter SA | Lanakam SA vs. Avax SA | Lanakam SA vs. National Bank of | Lanakam SA vs. EL D Mouzakis |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |