Correlation Between Comet Holding and Daetwyl I
Can any of the company-specific risk be diversified away by investing in both Comet Holding and Daetwyl I 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 Comet Holding and Daetwyl I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comet Holding AG and Daetwyl I, you can compare the effects of market volatilities on Comet Holding and Daetwyl I 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 Comet Holding with a short position of Daetwyl I. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comet Holding and Daetwyl I.
Diversification Opportunities for Comet Holding and Daetwyl I
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Comet and Daetwyl is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Comet Holding AG and Daetwyl I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daetwyl I and Comet 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 Comet Holding AG are associated (or correlated) with Daetwyl I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daetwyl I has no effect on the direction of Comet Holding i.e., Comet Holding and Daetwyl I go up and down completely randomly.
Pair Corralation between Comet Holding and Daetwyl I
Assuming the 90 days trading horizon Comet Holding AG is expected to generate 1.12 times more return on investment than Daetwyl I. However, Comet Holding is 1.12 times more volatile than Daetwyl I. It trades about -0.13 of its potential returns per unit of risk. Daetwyl I is currently generating about -0.18 per unit of risk. If you would invest 29,700 in Comet Holding AG on August 31, 2024 and sell it today you would lose (1,750) from holding Comet Holding AG or give up 5.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comet Holding AG vs. Daetwyl I
Performance |
| Timeline |
| Comet Holding AG |
| Daetwyl I |
Comet Holding and Daetwyl I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comet Holding and Daetwyl I
The main advantage of trading using opposite Comet Holding and Daetwyl I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comet Holding position performs unexpectedly, Daetwyl I 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 Daetwyl I will offset losses from the drop in Daetwyl I's long position.| Comet Holding vs. VAT Group AG | Comet Holding vs. Bachem Holding AG | Comet Holding vs. Inficon Holding | Comet Holding vs. Tecan Group AG |
| Daetwyl I vs. VAT Group AG | Daetwyl I vs. Bucher Industries AG | Daetwyl I vs. EMS CHEMIE HOLDING AG | Daetwyl I vs. Komax Holding 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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