Correlation Between Carl Zeiss and ATRION
Can any of the company-specific risk be diversified away by investing in both Carl Zeiss and ATRION 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 Carl Zeiss and ATRION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carl Zeiss Meditec and ATRION, you can compare the effects of market volatilities on Carl Zeiss and ATRION 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 Carl Zeiss with a short position of ATRION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carl Zeiss and ATRION.
Diversification Opportunities for Carl Zeiss and ATRION
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Carl and ATRION is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Carl Zeiss Meditec and ATRION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRION and Carl Zeiss 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 Carl Zeiss Meditec are associated (or correlated) with ATRION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRION has no effect on the direction of Carl Zeiss i.e., Carl Zeiss and ATRION go up and down completely randomly.
Pair Corralation between Carl Zeiss and ATRION
Assuming the 90 days horizon Carl Zeiss Meditec is expected to generate 0.42 times more return on investment than ATRION. However, Carl Zeiss Meditec is 2.35 times less risky than ATRION. It trades about -0.05 of its potential returns per unit of risk. ATRION is currently generating about -0.04 per unit of risk. If you would invest 13,272 in Carl Zeiss Meditec on September 4, 2024 and sell it today you would lose (7,263) from holding Carl Zeiss Meditec or give up 54.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.45% |
| Values | Daily Returns |
Carl Zeiss Meditec vs. ATRION
Performance |
| Timeline |
| Carl Zeiss Meditec |
| ATRION |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Carl Zeiss and ATRION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carl Zeiss and ATRION
The main advantage of trading using opposite Carl Zeiss and ATRION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carl Zeiss position performs unexpectedly, ATRION 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 ATRION will offset losses from the drop in ATRION's long position.| Carl Zeiss vs. CeCors Inc | Carl Zeiss vs. GlucoTrack | Carl Zeiss vs. Sharps Technology | Carl Zeiss vs. Wearable Health Solutions |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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