Correlation Between Cass Information and ÜSTRA Hannoversche
Can any of the company-specific risk be diversified away by investing in both Cass Information and ÜSTRA Hannoversche 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 Cass Information and ÜSTRA Hannoversche into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cass Information Systems and STRA Hannoversche Verkehrsbetriebe, you can compare the effects of market volatilities on Cass Information and ÜSTRA Hannoversche 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 Cass Information with a short position of ÜSTRA Hannoversche. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cass Information and ÜSTRA Hannoversche.
Diversification Opportunities for Cass Information and ÜSTRA Hannoversche
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cass and ÜSTRA is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Cass Information Systems and STRA Hannoversche Verkehrsbetr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ÜSTRA Hannoversche and Cass Information 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 Cass Information Systems are associated (or correlated) with ÜSTRA Hannoversche. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ÜSTRA Hannoversche has no effect on the direction of Cass Information i.e., Cass Information and ÜSTRA Hannoversche go up and down completely randomly.
Pair Corralation between Cass Information and ÜSTRA Hannoversche
Assuming the 90 days horizon Cass Information is expected to generate 2.39 times less return on investment than ÜSTRA Hannoversche. But when comparing it to its historical volatility, Cass Information Systems is 2.43 times less risky than ÜSTRA Hannoversche. It trades about 0.02 of its potential returns per unit of risk. STRA Hannoversche Verkehrsbetriebe is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,012 in STRA Hannoversche Verkehrsbetriebe on September 2, 2024 and sell it today you would lose (72.00) from holding STRA Hannoversche Verkehrsbetriebe or give up 7.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cass Information Systems vs. STRA Hannoversche Verkehrsbetr
Performance |
| Timeline |
| Cass Information Systems |
| ÜSTRA Hannoversche |
Cass Information and ÜSTRA Hannoversche Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cass Information and ÜSTRA Hannoversche
The main advantage of trading using opposite Cass Information and ÜSTRA Hannoversche positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cass Information position performs unexpectedly, ÜSTRA Hannoversche 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 ÜSTRA Hannoversche will offset losses from the drop in ÜSTRA Hannoversche's long position.| Cass Information vs. Superior Plus Corp | Cass Information vs. NMI Holdings | Cass Information vs. Origin Agritech | Cass Information vs. SIVERS SEMICONDUCTORS AB |
| ÜSTRA Hannoversche vs. SCANDMEDICAL SOLDK 040 | ÜSTRA Hannoversche vs. MGIC INVESTMENT | ÜSTRA Hannoversche vs. HK Electric Investments | ÜSTRA Hannoversche vs. MEDICAL FACILITIES NEW |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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