Correlation Between Atlas Copco and Siemens AG
Can any of the company-specific risk be diversified away by investing in both Atlas Copco and Siemens 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 Atlas Copco and Siemens AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Copco ADR and Siemens AG ADR, you can compare the effects of market volatilities on Atlas Copco and Siemens 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 Atlas Copco with a short position of Siemens AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Copco and Siemens AG.
Diversification Opportunities for Atlas Copco and Siemens AG
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Atlas and Siemens is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Copco ADR and Siemens AG ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens AG ADR and Atlas Copco 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 Atlas Copco ADR are associated (or correlated) with Siemens AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens AG ADR has no effect on the direction of Atlas Copco i.e., Atlas Copco and Siemens AG go up and down completely randomly.
Pair Corralation between Atlas Copco and Siemens AG
Assuming the 90 days horizon Atlas Copco is expected to generate 4.43 times less return on investment than Siemens AG. In addition to that, Atlas Copco is 1.25 times more volatile than Siemens AG ADR. It trades about 0.03 of its total potential returns per unit of risk. Siemens AG ADR is currently generating about 0.19 per unit of volatility. If you would invest 6,991 in Siemens AG ADR on August 29, 2024 and sell it today you would earn a total of 844.00 from holding Siemens AG ADR or generate 12.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 8.67% |
| Values | Daily Returns |
Atlas Copco ADR vs. Siemens AG ADR
Performance |
| Timeline |
| Atlas Copco ADR |
| Siemens AG ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Atlas Copco and Siemens AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Copco and Siemens AG
The main advantage of trading using opposite Atlas Copco and Siemens AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Copco position performs unexpectedly, Siemens 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 Siemens AG will offset losses from the drop in Siemens AG's long position.| Atlas Copco vs. Amaero International | Atlas Copco vs. Aumann AG | Atlas Copco vs. Atlas Copco AB | Atlas Copco vs. Alfa Laval AB |
| Siemens AG vs. Sandvik AB | Siemens AG vs. Schneider Electric SA | Siemens AG vs. KONE Oyj | Siemens AG vs. Atlas Copco AB |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |