Correlation Between Bachem Holding and Komax Holding
Can any of the company-specific risk be diversified away by investing in both Bachem Holding and Komax Holding 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 Komax Holding 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 Komax Holding AG, you can compare the effects of market volatilities on Bachem Holding and Komax Holding 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 Komax Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bachem Holding and Komax Holding.
Diversification Opportunities for Bachem Holding and Komax Holding
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bachem and Komax is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bachem Holding AG and Komax Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Komax Holding AG 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 Komax Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Komax Holding AG has no effect on the direction of Bachem Holding i.e., Bachem Holding and Komax Holding go up and down completely randomly.
Pair Corralation between Bachem Holding and Komax Holding
Assuming the 90 days trading horizon Bachem Holding is expected to generate 17.43 times less return on investment than Komax Holding. In addition to that, Bachem Holding is 1.48 times more volatile than Komax Holding AG. It trades about 0.0 of its total potential returns per unit of risk. Komax Holding AG is currently generating about 0.12 per unit of volatility. If you would invest 10,960 in Komax Holding AG on September 1, 2024 and sell it today you would earn a total of 440.00 from holding Komax Holding AG or generate 4.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bachem Holding AG vs. Komax Holding AG
Performance |
| Timeline |
| Bachem Holding AG |
| Komax Holding AG |
Bachem Holding and Komax Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bachem Holding and Komax Holding
The main advantage of trading using opposite Bachem Holding and Komax Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bachem Holding position performs unexpectedly, Komax Holding 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 Komax Holding will offset losses from the drop in Komax Holding's 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 |
| Komax Holding vs. Comet Holding AG | Komax Holding vs. Bossard Holding AG | Komax Holding vs. VAT Group AG | Komax Holding vs. Bucher Industries 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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