Correlation Between Erste Group and Semperit Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both Erste Group and Semperit Aktiengesellscha 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 Erste Group and Semperit Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Erste Group Bank and Semperit Aktiengesellschaft Holding, you can compare the effects of market volatilities on Erste Group and Semperit Aktiengesellscha 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 Erste Group with a short position of Semperit Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Erste Group and Semperit Aktiengesellscha.
Diversification Opportunities for Erste Group and Semperit Aktiengesellscha
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Erste and Semperit is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Erste Group Bank and Semperit Aktiengesellschaft Ho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semperit Aktiengesellscha and Erste Group 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 Erste Group Bank are associated (or correlated) with Semperit Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semperit Aktiengesellscha has no effect on the direction of Erste Group i.e., Erste Group and Semperit Aktiengesellscha go up and down completely randomly.
Pair Corralation between Erste Group and Semperit Aktiengesellscha
Assuming the 90 days trading horizon Erste Group Bank is expected to generate 0.67 times more return on investment than Semperit Aktiengesellscha. However, Erste Group Bank is 1.49 times less risky than Semperit Aktiengesellscha. It trades about 0.11 of its potential returns per unit of risk. Semperit Aktiengesellschaft Holding is currently generating about -0.03 per unit of risk. If you would invest 3,673 in Erste Group Bank on August 25, 2024 and sell it today you would earn a total of 1,525 from holding Erste Group Bank or generate 41.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Erste Group Bank vs. Semperit Aktiengesellschaft Ho
Performance |
| Timeline |
| Erste Group Bank |
| Semperit Aktiengesellscha |
Erste Group and Semperit Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Erste Group and Semperit Aktiengesellscha
The main advantage of trading using opposite Erste Group and Semperit Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Erste Group position performs unexpectedly, Semperit Aktiengesellscha 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 Semperit Aktiengesellscha will offset losses from the drop in Semperit Aktiengesellscha's long position.| Erste Group vs. Raiffeisen Bank International | Erste Group vs. OMV Aktiengesellschaft | Erste Group vs. Voestalpine AG | Erste Group vs. Vienna Insurance Group |
| Semperit Aktiengesellscha vs. Wienerberger AG | Semperit Aktiengesellscha vs. Andritz AG | Semperit Aktiengesellscha vs. Lenzing Aktiengesellschaft | Semperit Aktiengesellscha vs. Voestalpine 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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