Correlation Between Baloise Holding and ZKB Gold
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and ZKB Gold 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 ZKB Gold 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 ZKB Gold ETF, you can compare the effects of market volatilities on Baloise Holding and ZKB Gold 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 ZKB Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and ZKB Gold.
Diversification Opportunities for Baloise Holding and ZKB Gold
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Baloise and ZKB is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and ZKB Gold ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Gold ETF 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 ZKB Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Gold ETF has no effect on the direction of Baloise Holding i.e., Baloise Holding and ZKB Gold go up and down completely randomly.
Pair Corralation between Baloise Holding and ZKB Gold
Assuming the 90 days trading horizon Baloise Holding AG is expected to under-perform the ZKB Gold. But the stock apears to be less risky and, when comparing its historical volatility, Baloise Holding AG is 1.16 times less risky than ZKB Gold. The stock trades about -0.18 of its potential returns per unit of risk. The ZKB Gold ETF is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 136,780 in ZKB Gold ETF on September 13, 2024 and sell it today you would earn a total of 1,080 from holding ZKB Gold ETF or generate 0.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baloise Holding AG vs. ZKB Gold ETF
Performance |
| Timeline |
| Baloise Holding AG |
| ZKB Gold ETF |
Baloise Holding and ZKB Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baloise Holding and ZKB Gold
The main advantage of trading using opposite Baloise Holding and ZKB Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, ZKB Gold 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 ZKB Gold will offset losses from the drop in ZKB Gold'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 |
| ZKB Gold vs. Baloise Holding AG | ZKB Gold vs. 21Shares Polkadot ETP | ZKB Gold vs. UBS ETF MSCI | ZKB Gold 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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