Correlation Between Koninklijke Ahold and Talanx AG
Can any of the company-specific risk be diversified away by investing in both Koninklijke Ahold and Talanx AG 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 Koninklijke Ahold and Talanx AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koninklijke Ahold Delhaize and Talanx AG, you can compare the effects of market volatilities on Koninklijke Ahold and Talanx AG 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 Koninklijke Ahold with a short position of Talanx AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koninklijke Ahold and Talanx AG.
Diversification Opportunities for Koninklijke Ahold and Talanx AG
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Koninklijke and Talanx is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Koninklijke Ahold Delhaize and Talanx AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talanx AG and Koninklijke Ahold 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 Koninklijke Ahold Delhaize are associated (or correlated) with Talanx AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talanx AG has no effect on the direction of Koninklijke Ahold i.e., Koninklijke Ahold and Talanx AG go up and down completely randomly.
Pair Corralation between Koninklijke Ahold and Talanx AG
Assuming the 90 days trading horizon Koninklijke Ahold Delhaize is expected to generate 0.71 times more return on investment than Talanx AG. However, Koninklijke Ahold Delhaize is 1.4 times less risky than Talanx AG. It trades about 0.11 of its potential returns per unit of risk. Talanx AG is currently generating about 0.04 per unit of risk. If you would invest 2,831 in Koninklijke Ahold Delhaize on September 1, 2024 and sell it today you would earn a total of 424.00 from holding Koninklijke Ahold Delhaize or generate 14.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.24% |
| Values | Daily Returns |
Koninklijke Ahold Delhaize vs. Talanx AG
Performance |
| Timeline |
| Koninklijke Ahold |
| Talanx AG |
Koninklijke Ahold and Talanx AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koninklijke Ahold and Talanx AG
The main advantage of trading using opposite Koninklijke Ahold and Talanx AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koninklijke Ahold position performs unexpectedly, Talanx AG 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 Talanx AG will offset losses from the drop in Talanx AG's long position.| Koninklijke Ahold vs. TESCO PLC LS 0633333 | Koninklijke Ahold vs. Superior Plus Corp | Koninklijke Ahold vs. NMI Holdings | Koninklijke Ahold vs. Origin Agritech |
| Talanx AG vs. Retail Estates NV | Talanx AG vs. COMMERCIAL VEHICLE | Talanx AG vs. Geely Automobile Holdings | Talanx AG vs. Commercial Vehicle Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |