Correlation Between Bachem Holding and Bucher Industries
Can any of the company-specific risk be diversified away by investing in both Bachem Holding and Bucher Industries 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 Bucher Industries 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 Bucher Industries AG, you can compare the effects of market volatilities on Bachem Holding and Bucher Industries 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 Bucher Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bachem Holding and Bucher Industries.
Diversification Opportunities for Bachem Holding and Bucher Industries
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bachem and Bucher is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Bachem Holding AG and Bucher Industries AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bucher Industries 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 Bucher Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bucher Industries has no effect on the direction of Bachem Holding i.e., Bachem Holding and Bucher Industries go up and down completely randomly.
Pair Corralation between Bachem Holding and Bucher Industries
Assuming the 90 days trading horizon Bachem Holding is expected to generate 5.28 times less return on investment than Bucher Industries. In addition to that, Bachem Holding is 2.51 times more volatile than Bucher Industries AG. It trades about 0.0 of its total potential returns per unit of risk. Bucher Industries AG is currently generating about 0.06 per unit of volatility. If you would invest 33,650 in Bucher Industries AG on September 1, 2024 and sell it today you would earn a total of 400.00 from holding Bucher Industries AG or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bachem Holding AG vs. Bucher Industries AG
Performance |
| Timeline |
| Bachem Holding AG |
| Bucher Industries |
Bachem Holding and Bucher Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bachem Holding and Bucher Industries
The main advantage of trading using opposite Bachem Holding and Bucher Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bachem Holding position performs unexpectedly, Bucher Industries 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 Bucher Industries will offset losses from the drop in Bucher Industries' long position.| Bachem Holding vs. Siegfried Holding | Bachem Holding vs. VAT Group AG | Bachem Holding vs. Lonza Group AG | Bachem Holding vs. Straumann Holding AG |
| Bucher Industries vs. OC Oerlikon Corp | Bucher Industries vs. Helvetia Holding AG | Bucher Industries vs. Swiss Life Holding | Bucher Industries vs. VAT Group 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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