Correlation Between Baloise Holding and Multi Units
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and Multi Units 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 Baloise Holding and Multi Units into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baloise Holding AG and Multi Units Luxembourg, you can compare the effects of market volatilities on Baloise Holding and Multi Units 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 Baloise Holding with a short position of Multi Units. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and Multi Units.
Diversification Opportunities for Baloise Holding and Multi Units
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Baloise and Multi is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and Multi Units Luxembourg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Units Luxembourg and Baloise Holding 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 Baloise Holding AG are associated (or correlated) with Multi Units. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Units Luxembourg has no effect on the direction of Baloise Holding i.e., Baloise Holding and Multi Units go up and down completely randomly.
Pair Corralation between Baloise Holding and Multi Units
Assuming the 90 days trading horizon Baloise Holding AG is expected to generate 1.41 times more return on investment than Multi Units. However, Baloise Holding is 1.41 times more volatile than Multi Units Luxembourg. It trades about 0.05 of its potential returns per unit of risk. Multi Units Luxembourg is currently generating about 0.05 per unit of risk. If you would invest 12,958 in Baloise Holding AG on September 14, 2024 and sell it today you would earn a total of 3,342 from holding Baloise Holding AG or generate 25.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baloise Holding AG vs. Multi Units Luxembourg
Performance |
| Timeline |
| Baloise Holding AG |
| Multi Units Luxembourg |
Baloise Holding and Multi Units Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and Multi Units
The main advantage of trading using opposite Baloise Holding and Multi Units positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, Multi Units 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 Multi Units will offset losses from the drop in Multi Units' long position.| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
| Multi Units vs. Baloise Holding AG | Multi Units vs. 21Shares Polkadot ETP | Multi Units vs. UBS ETF MSCI | Multi Units vs. BB Biotech 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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