Correlation Between NV Bekaert and Thyssenkrupp
Can any of the company-specific risk be diversified away by investing in both NV Bekaert and Thyssenkrupp 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 NV Bekaert and Thyssenkrupp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NV Bekaert SA and Thyssenkrupp AG ON, you can compare the effects of market volatilities on NV Bekaert and Thyssenkrupp 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 NV Bekaert with a short position of Thyssenkrupp. Check out your portfolio center. Please also check ongoing floating volatility patterns of NV Bekaert and Thyssenkrupp.
Diversification Opportunities for NV Bekaert and Thyssenkrupp
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between BEKAY and Thyssenkrupp is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding NV Bekaert SA and Thyssenkrupp AG ON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thyssenkrupp AG ON and NV Bekaert 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 NV Bekaert SA are associated (or correlated) with Thyssenkrupp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thyssenkrupp AG ON has no effect on the direction of NV Bekaert i.e., NV Bekaert and Thyssenkrupp go up and down completely randomly.
Pair Corralation between NV Bekaert and Thyssenkrupp
Assuming the 90 days horizon NV Bekaert SA is expected to under-perform the Thyssenkrupp. But the pink sheet apears to be less risky and, when comparing its historical volatility, NV Bekaert SA is 2.85 times less risky than Thyssenkrupp. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Thyssenkrupp AG ON is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 472.00 in Thyssenkrupp AG ON on September 3, 2024 and sell it today you would lose (62.00) from holding Thyssenkrupp AG ON or give up 13.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NV Bekaert SA vs. Thyssenkrupp AG ON
Performance |
| Timeline |
| NV Bekaert SA |
| Thyssenkrupp AG ON |
NV Bekaert and Thyssenkrupp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NV Bekaert and Thyssenkrupp
The main advantage of trading using opposite NV Bekaert and Thyssenkrupp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NV Bekaert position performs unexpectedly, Thyssenkrupp 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 Thyssenkrupp will offset losses from the drop in Thyssenkrupp's long position.| NV Bekaert vs. Thyssenkrupp AG ON | NV Bekaert vs. Mueller Industries | NV Bekaert vs. Insteel Industries | NV Bekaert vs. Carpenter Technology |
| Thyssenkrupp vs. ESAB Corp | Thyssenkrupp vs. Worthington Industries | Thyssenkrupp vs. Allegheny Technologies Incorporated | Thyssenkrupp vs. Insteel Industries |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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