Correlation Between Burkhalter Holding and Helvetia Holding
Can any of the company-specific risk be diversified away by investing in both Burkhalter Holding and Helvetia 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 Burkhalter Holding and Helvetia Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burkhalter Holding AG and Helvetia Holding AG, you can compare the effects of market volatilities on Burkhalter Holding and Helvetia 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 Burkhalter Holding with a short position of Helvetia Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burkhalter Holding and Helvetia Holding.
Diversification Opportunities for Burkhalter Holding and Helvetia Holding
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Burkhalter and Helvetia is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Burkhalter Holding AG and Helvetia Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helvetia Holding and Burkhalter 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 Burkhalter Holding AG are associated (or correlated) with Helvetia Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helvetia Holding has no effect on the direction of Burkhalter Holding i.e., Burkhalter Holding and Helvetia Holding go up and down completely randomly.
Pair Corralation between Burkhalter Holding and Helvetia Holding
Assuming the 90 days trading horizon Burkhalter Holding is expected to generate 1.66 times less return on investment than Helvetia Holding. In addition to that, Burkhalter Holding is 1.67 times more volatile than Helvetia Holding AG. It trades about 0.14 of its total potential returns per unit of risk. Helvetia Holding AG is currently generating about 0.4 per unit of volatility. If you would invest 14,700 in Helvetia Holding AG on September 3, 2024 and sell it today you would earn a total of 740.00 from holding Helvetia Holding AG or generate 5.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Burkhalter Holding AG vs. Helvetia Holding AG
Performance |
| Timeline |
| Burkhalter Holding |
| Helvetia Holding |
Burkhalter Holding and Helvetia Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burkhalter Holding and Helvetia Holding
The main advantage of trading using opposite Burkhalter Holding and Helvetia Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burkhalter Holding position performs unexpectedly, Helvetia 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 Helvetia Holding will offset losses from the drop in Helvetia Holding's long position.| Burkhalter Holding vs. mobilezone ag | Burkhalter Holding vs. Cembra Money Bank | Burkhalter Holding vs. OC Oerlikon Corp | Burkhalter Holding vs. Banque Cantonale |
| Helvetia Holding vs. Swiss Life Holding | Helvetia Holding vs. Baloise Holding AG | Helvetia Holding vs. Swiss Re AG | Helvetia Holding vs. Zurich Insurance Group |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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