Correlation Between Agilent Technologies and Siemens Healthineers
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Siemens Healthineers 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 Agilent Technologies and Siemens Healthineers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Siemens Healthineers AG, you can compare the effects of market volatilities on Agilent Technologies and Siemens Healthineers 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 Agilent Technologies with a short position of Siemens Healthineers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Siemens Healthineers.
Diversification Opportunities for Agilent Technologies and Siemens Healthineers
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Agilent and Siemens is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Siemens Healthineers AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Healthineers and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Siemens Healthineers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Healthineers has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Siemens Healthineers go up and down completely randomly.
Pair Corralation between Agilent Technologies and Siemens Healthineers
Assuming the 90 days horizon Agilent Technologies is expected to under-perform the Siemens Healthineers. In addition to that, Agilent Technologies is 1.33 times more volatile than Siemens Healthineers AG. It trades about -0.02 of its total potential returns per unit of risk. Siemens Healthineers AG is currently generating about 0.14 per unit of volatility. If you would invest 5,070 in Siemens Healthineers AG on September 29, 2024 and sell it today you would earn a total of 138.00 from holding Siemens Healthineers AG or generate 2.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Siemens Healthineers AG
Performance |
| Timeline |
| Agilent Technologies |
| Siemens Healthineers |
Agilent Technologies and Siemens Healthineers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Siemens Healthineers
The main advantage of trading using opposite Agilent Technologies and Siemens Healthineers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Siemens Healthineers 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 Siemens Healthineers will offset losses from the drop in Siemens Healthineers' long position.| Agilent Technologies vs. WuXi AppTec Co | Agilent Technologies vs. Danaher | Agilent Technologies vs. Danaher | Agilent Technologies vs. SIEMENS HEALTH ADR050 |
| Siemens Healthineers vs. WuXi AppTec Co | Siemens Healthineers vs. Danaher | Siemens Healthineers vs. Danaher | Siemens Healthineers vs. SIEMENS HEALTH ADR050 |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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