Correlation Between AT S and Frequentis
Can any of the company-specific risk be diversified away by investing in both AT S and Frequentis 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 AT S and Frequentis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AT S Austria and Frequentis AG, you can compare the effects of market volatilities on AT S and Frequentis 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 AT S with a short position of Frequentis. Check out your portfolio center. Please also check ongoing floating volatility patterns of AT S and Frequentis.
Diversification Opportunities for AT S and Frequentis
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ATS and Frequentis is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding AT S Austria and Frequentis AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequentis AG and AT S 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 AT S Austria are associated (or correlated) with Frequentis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequentis AG has no effect on the direction of AT S i.e., AT S and Frequentis go up and down completely randomly.
Pair Corralation between AT S and Frequentis
Assuming the 90 days trading horizon AT S Austria is expected to under-perform the Frequentis. In addition to that, AT S is 1.7 times more volatile than Frequentis AG. It trades about -0.04 of its total potential returns per unit of risk. Frequentis AG is currently generating about 0.01 per unit of volatility. If you would invest 3,061 in Frequentis AG on November 27, 2024 and sell it today you would lose (41.00) from holding Frequentis AG or give up 1.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
AT S Austria vs. Frequentis AG
Performance |
| Timeline |
| AT S Austria |
| Frequentis AG |
AT S and Frequentis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AT S and Frequentis
The main advantage of trading using opposite AT S and Frequentis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AT S position performs unexpectedly, Frequentis 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 Frequentis will offset losses from the drop in Frequentis' long position.| AT S vs. Voestalpine AG | AT S vs. Lenzing Aktiengesellschaft | AT S vs. Andritz AG | AT S vs. OMV Aktiengesellschaft |
| Frequentis vs. AT S Austria | Frequentis vs. Lenzing Aktiengesellschaft | Frequentis vs. Facc AG | Frequentis vs. EVN 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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