Correlation Between Bachem Holding and Airesis SA
Can any of the company-specific risk be diversified away by investing in both Bachem Holding and Airesis SA 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 Bachem Holding and Airesis SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bachem Holding AG and Airesis SA, you can compare the effects of market volatilities on Bachem Holding and Airesis SA 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 Bachem Holding with a short position of Airesis SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bachem Holding and Airesis SA.
Diversification Opportunities for Bachem Holding and Airesis SA
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bachem and Airesis is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bachem Holding AG and Airesis SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airesis SA and Bachem 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 Bachem Holding AG are associated (or correlated) with Airesis SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airesis SA has no effect on the direction of Bachem Holding i.e., Bachem Holding and Airesis SA go up and down completely randomly.
Pair Corralation between Bachem Holding and Airesis SA
Assuming the 90 days trading horizon Bachem Holding AG is expected to under-perform the Airesis SA. But the stock apears to be less risky and, when comparing its historical volatility, Bachem Holding AG is 5.6 times less risky than Airesis SA. The stock trades about -0.02 of its potential returns per unit of risk. The Airesis SA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 59.00 in Airesis SA on August 31, 2024 and sell it today you would lose (52.00) from holding Airesis SA or give up 88.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 84.57% |
| Values | Daily Returns |
Bachem Holding AG vs. Airesis SA
Performance |
| Timeline |
| Bachem Holding AG |
| Airesis SA |
Bachem Holding and Airesis SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bachem Holding and Airesis SA
The main advantage of trading using opposite Bachem Holding and Airesis SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bachem Holding position performs unexpectedly, Airesis SA 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 Airesis SA will offset losses from the drop in Airesis SA's long position.| Bachem Holding vs. Jungfraubahn Holding AG | Bachem Holding vs. Amsterdam Commodities NV | Bachem Holding vs. Flow Traders BV | Bachem Holding vs. ForFarmers NV |
| Airesis SA vs. Ascom Holding AG | Airesis SA vs. Bellevue Group AG | Airesis SA vs. Cicor Technologies | Airesis SA vs. Adval Tech Holding |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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