Correlation Between AT S and Palfinger
Can any of the company-specific risk be diversified away by investing in both AT S 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 AT S and Palfinger 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 Palfinger AG, you can compare the effects of market volatilities on AT S 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 AT S with a short position of Palfinger. Check out your portfolio center. Please also check ongoing floating volatility patterns of AT S and Palfinger.
Diversification Opportunities for AT S and Palfinger
Poor diversification
The 3 months correlation between ATS and Palfinger is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding AT S Austria and Palfinger AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palfinger 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 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 AT S i.e., AT S and Palfinger go up and down completely randomly.
Pair Corralation between AT S and Palfinger
Assuming the 90 days trading horizon AT S Austria is expected to under-perform the Palfinger. In addition to that, AT S is 2.13 times more volatile than Palfinger AG. It trades about -0.05 of its total potential returns per unit of risk. Palfinger AG is currently generating about -0.07 per unit of volatility. If you would invest 2,395 in Palfinger AG on August 27, 2024 and sell it today you would lose (431.00) from holding Palfinger AG or give up 18.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AT S Austria vs. Palfinger AG
Performance |
| Timeline |
| AT S Austria |
| Palfinger AG |
AT S and Palfinger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AT S and Palfinger
The main advantage of trading using opposite AT S and Palfinger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AT S 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.| AT S vs. Voestalpine AG | AT S vs. Lenzing Aktiengesellschaft | AT S vs. Andritz AG | AT S vs. OMV Aktiengesellschaft |
| Palfinger vs. RATH Aktiengesellschaft | Palfinger vs. Semperit Aktiengesellschaft Holding | Palfinger vs. Oesterr Post AG | Palfinger vs. Anheuser Busch InBev SANV |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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