Correlation Between Cembra Money and Xlife Sciences
Can any of the company-specific risk be diversified away by investing in both Cembra Money and Xlife Sciences 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 Cembra Money and Xlife Sciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cembra Money Bank and Xlife Sciences AG, you can compare the effects of market volatilities on Cembra Money and Xlife Sciences 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 Cembra Money with a short position of Xlife Sciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cembra Money and Xlife Sciences.
Diversification Opportunities for Cembra Money and Xlife Sciences
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cembra and Xlife is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cembra Money Bank and Xlife Sciences AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xlife Sciences AG and Cembra Money 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 Cembra Money Bank are associated (or correlated) with Xlife Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xlife Sciences AG has no effect on the direction of Cembra Money i.e., Cembra Money and Xlife Sciences go up and down completely randomly.
Pair Corralation between Cembra Money and Xlife Sciences
Assuming the 90 days trading horizon Cembra Money is expected to generate 1.19 times less return on investment than Xlife Sciences. But when comparing it to its historical volatility, Cembra Money Bank is 3.56 times less risky than Xlife Sciences. It trades about 0.04 of its potential returns per unit of risk. Xlife Sciences AG is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,890 in Xlife Sciences AG on September 13, 2024 and sell it today you would lose (310.00) from holding Xlife Sciences AG or give up 10.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Cembra Money Bank vs. Xlife Sciences AG
Performance |
| Timeline |
| Cembra Money Bank |
| Xlife Sciences AG |
Cembra Money and Xlife Sciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cembra Money and Xlife Sciences
The main advantage of trading using opposite Cembra Money and Xlife Sciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cembra Money position performs unexpectedly, Xlife Sciences 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 Xlife Sciences will offset losses from the drop in Xlife Sciences' long position.| Cembra Money vs. Helvetia Holding AG | Cembra Money vs. Swiss Life Holding | Cembra Money vs. Baloise Holding AG | Cembra Money vs. Logitech International SA |
| Xlife Sciences vs. Metall Zug AG | Xlife Sciences vs. Cembra Money Bank | Xlife Sciences vs. BB Biotech AG | Xlife Sciences vs. Basellandschaftliche Kantonalbank |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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