Correlation Between AutoWallis Nyrt and BASF SE
Can any of the company-specific risk be diversified away by investing in both AutoWallis Nyrt and BASF SE 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 AutoWallis Nyrt and BASF SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AutoWallis Nyrt and BASF SE, you can compare the effects of market volatilities on AutoWallis Nyrt and BASF SE 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 AutoWallis Nyrt with a short position of BASF SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of AutoWallis Nyrt and BASF SE.
Diversification Opportunities for AutoWallis Nyrt and BASF SE
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AutoWallis and BASF is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding AutoWallis Nyrt and BASF SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASF SE and AutoWallis Nyrt 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 AutoWallis Nyrt are associated (or correlated) with BASF SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASF SE has no effect on the direction of AutoWallis Nyrt i.e., AutoWallis Nyrt and BASF SE go up and down completely randomly.
Pair Corralation between AutoWallis Nyrt and BASF SE
Assuming the 90 days trading horizon AutoWallis Nyrt is expected to generate 8.69 times less return on investment than BASF SE. But when comparing it to its historical volatility, AutoWallis Nyrt is 1.09 times less risky than BASF SE. It trades about 0.07 of its potential returns per unit of risk. BASF SE is currently generating about 0.56 of returns per unit of risk over similar time horizon. If you would invest 1,718,000 in BASF SE on September 18, 2024 and sell it today you would earn a total of 146,400 from holding BASF SE or generate 8.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 36.36% |
| Values | Daily Returns |
AutoWallis Nyrt vs. BASF SE
Performance |
| Timeline |
| AutoWallis Nyrt |
| BASF SE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
AutoWallis Nyrt and BASF SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AutoWallis Nyrt and BASF SE
The main advantage of trading using opposite AutoWallis Nyrt and BASF SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AutoWallis Nyrt position performs unexpectedly, BASF SE 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 BASF SE will offset losses from the drop in BASF SE's long position.| AutoWallis Nyrt vs. OTP Bank Nyrt | AutoWallis Nyrt vs. MOL Nyrt | AutoWallis Nyrt vs. OPUS GLOBAL Nyrt | AutoWallis Nyrt vs. ALTEO Energiaszolgaltato Nyrt |
| BASF SE vs. OTP Bank Nyrt | BASF SE vs. MOL Nyrt | BASF SE vs. OPUS GLOBAL Nyrt | BASF SE vs. ALTEO Energiaszolgaltato Nyrt |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |