Correlation Between Adval Tech and Cembra Money
Can any of the company-specific risk be diversified away by investing in both Adval Tech and Cembra Money 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 Adval Tech and Cembra Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adval Tech Holding and Cembra Money Bank, you can compare the effects of market volatilities on Adval Tech and Cembra Money 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 Adval Tech with a short position of Cembra Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adval Tech and Cembra Money.
Diversification Opportunities for Adval Tech and Cembra Money
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Adval and Cembra is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Adval Tech Holding and Cembra Money Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cembra Money Bank and Adval Tech 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 Adval Tech Holding are associated (or correlated) with Cembra Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cembra Money Bank has no effect on the direction of Adval Tech i.e., Adval Tech and Cembra Money go up and down completely randomly.
Pair Corralation between Adval Tech and Cembra Money
Assuming the 90 days trading horizon Adval Tech Holding is expected to under-perform the Cembra Money. In addition to that, Adval Tech is 2.53 times more volatile than Cembra Money Bank. It trades about -0.08 of its total potential returns per unit of risk. Cembra Money Bank is currently generating about 0.11 per unit of volatility. If you would invest 6,205 in Cembra Money Bank on September 4, 2024 and sell it today you would earn a total of 1,960 from holding Cembra Money Bank or generate 31.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 70.04% |
| Values | Daily Returns |
Adval Tech Holding vs. Cembra Money Bank
Performance |
| Timeline |
| Adval Tech Holding |
| Cembra Money Bank |
Adval Tech and Cembra Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adval Tech and Cembra Money
The main advantage of trading using opposite Adval Tech and Cembra Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adval Tech position performs unexpectedly, Cembra Money 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 Cembra Money will offset losses from the drop in Cembra Money's long position.| Adval Tech vs. Feintool International Holding | Adval Tech vs. Also Holding AG | Adval Tech vs. Allreal Holding | Adval Tech vs. Forbo Holding AG |
| Cembra Money vs. Helvetia Holding AG | Cembra Money vs. Swiss Life Holding | Cembra Money vs. Baloise Holding AG | Cembra Money vs. Logitech International SA |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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