Correlation Between AMAG Austria and Palfinger
Can any of the company-specific risk be diversified away by investing in both AMAG Austria and Palfinger 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 AMAG Austria and Palfinger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMAG Austria Metall and Palfinger AG, you can compare the effects of market volatilities on AMAG Austria and Palfinger 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 AMAG Austria with a short position of Palfinger. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMAG Austria and Palfinger.
Diversification Opportunities for AMAG Austria and Palfinger
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between AMAG and Palfinger is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding AMAG Austria Metall and Palfinger AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palfinger AG and AMAG Austria 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 AMAG Austria Metall are associated (or correlated) with Palfinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Palfinger AG has no effect on the direction of AMAG Austria i.e., AMAG Austria and Palfinger go up and down completely randomly.
Pair Corralation between AMAG Austria and Palfinger
Assuming the 90 days trading horizon AMAG Austria Metall is expected to generate 2.27 times more return on investment than Palfinger. However, AMAG Austria is 2.27 times more volatile than Palfinger AG. It trades about -0.08 of its potential returns per unit of risk. Palfinger AG is currently generating about -0.27 per unit of risk. If you would invest 2,460 in AMAG Austria Metall on September 2, 2024 and sell it today you would lose (70.00) from holding AMAG Austria Metall or give up 2.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMAG Austria Metall vs. Palfinger AG
Performance |
| Timeline |
| AMAG Austria Metall |
| Palfinger AG |
AMAG Austria and Palfinger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMAG Austria and Palfinger
The main advantage of trading using opposite AMAG Austria and Palfinger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMAG Austria position performs unexpectedly, Palfinger 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 Palfinger will offset losses from the drop in Palfinger's long position.| AMAG Austria vs. Lenzing Aktiengesellschaft | AMAG Austria vs. Voestalpine AG | AMAG Austria vs. EVN AG | AMAG Austria vs. Facc AG |
| Palfinger vs. RATH Aktiengesellschaft | Palfinger vs. Semperit Aktiengesellschaft Holding | Palfinger vs. Telekom Austria AG | Palfinger vs. Oesterr Post AG |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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