Correlation Between Austrian Traded and Burgenland Holding
Can any of the company-specific risk be diversified away by investing in both Austrian Traded and Burgenland Holding 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 Austrian Traded and Burgenland Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Austrian Traded Index and Burgenland Holding Aktiengesellschaft, you can compare the effects of market volatilities on Austrian Traded and Burgenland Holding 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 Austrian Traded with a short position of Burgenland Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Austrian Traded and Burgenland Holding.
Diversification Opportunities for Austrian Traded and Burgenland Holding
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Austrian and Burgenland is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Austrian Traded Index and Burgenland Holding Aktiengesel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burgenland Holding and Austrian Traded 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 Austrian Traded Index are associated (or correlated) with Burgenland Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burgenland Holding has no effect on the direction of Austrian Traded i.e., Austrian Traded and Burgenland Holding go up and down completely randomly.
Pair Corralation between Austrian Traded and Burgenland Holding
Assuming the 90 days trading horizon Austrian Traded Index is expected to generate 1.07 times more return on investment than Burgenland Holding. However, Austrian Traded is 1.07 times more volatile than Burgenland Holding Aktiengesellschaft. It trades about -0.04 of its potential returns per unit of risk. Burgenland Holding Aktiengesellschaft is currently generating about -0.13 per unit of risk. If you would invest 355,774 in Austrian Traded Index on August 24, 2024 and sell it today you would lose (3,288) from holding Austrian Traded Index or give up 0.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Austrian Traded Index vs. Burgenland Holding Aktiengesel
Performance |
| Timeline |
Austrian Traded and Burgenland Holding Volatility Contrast
Predicted Return Density |
| Returns |
Austrian Traded Index
Pair trading matchups for Austrian Traded
Burgenland Holding Aktiengesellschaft
Pair trading matchups for Burgenland Holding
Pair Trading with Austrian Traded and Burgenland Holding
The main advantage of trading using opposite Austrian Traded and Burgenland Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Austrian Traded position performs unexpectedly, Burgenland Holding 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 Burgenland Holding will offset losses from the drop in Burgenland Holding's long position.| Austrian Traded vs. SBM Offshore NV | Austrian Traded vs. Erste Group Bank | Austrian Traded vs. Addiko Bank AG | Austrian Traded vs. AMAG Austria Metall |
| Burgenland Holding vs. EVN AG | Burgenland Holding vs. AGRANA Beteiligungs Aktiengesellschaft | Burgenland Holding vs. Palfinger AG | Burgenland Holding vs. Rosenbauer International 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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