Correlation Between Baloise Holding and Xtrackers Switzerland
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and Xtrackers Switzerland 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 Xtrackers Switzerland 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 Xtrackers Switzerland UCITS, you can compare the effects of market volatilities on Baloise Holding and Xtrackers Switzerland 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 Xtrackers Switzerland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and Xtrackers Switzerland.
Diversification Opportunities for Baloise Holding and Xtrackers Switzerland
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baloise and Xtrackers is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and Xtrackers Switzerland UCITS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers Switzerland 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 Xtrackers Switzerland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers Switzerland has no effect on the direction of Baloise Holding i.e., Baloise Holding and Xtrackers Switzerland go up and down completely randomly.
Pair Corralation between Baloise Holding and Xtrackers Switzerland
Assuming the 90 days trading horizon Baloise Holding AG is expected to generate 1.45 times more return on investment than Xtrackers Switzerland. However, Baloise Holding is 1.45 times more volatile than Xtrackers Switzerland UCITS. It trades about 0.05 of its potential returns per unit of risk. Xtrackers Switzerland UCITS is currently generating about 0.03 per unit of risk. If you would invest 12,895 in Baloise Holding AG on September 12, 2024 and sell it today you would earn a total of 3,515 from holding Baloise Holding AG or generate 27.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Baloise Holding AG vs. Xtrackers Switzerland UCITS
Performance |
| Timeline |
| Baloise Holding AG |
| Xtrackers Switzerland |
Baloise Holding and Xtrackers Switzerland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and Xtrackers Switzerland
The main advantage of trading using opposite Baloise Holding and Xtrackers Switzerland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, Xtrackers Switzerland 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 Xtrackers Switzerland will offset losses from the drop in Xtrackers Switzerland's 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 |
| Xtrackers Switzerland vs. Baloise Holding AG | Xtrackers Switzerland vs. 21Shares Polkadot ETP | Xtrackers Switzerland vs. UBS ETF MSCI | Xtrackers Switzerland 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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