Correlation Between ELMOS SEMICONDUCTOR and CTS Eventim
Can any of the company-specific risk be diversified away by investing in both ELMOS SEMICONDUCTOR and CTS Eventim 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 ELMOS SEMICONDUCTOR and CTS Eventim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ELMOS SEMICONDUCTOR and CTS Eventim AG, you can compare the effects of market volatilities on ELMOS SEMICONDUCTOR and CTS Eventim 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 ELMOS SEMICONDUCTOR with a short position of CTS Eventim. Check out your portfolio center. Please also check ongoing floating volatility patterns of ELMOS SEMICONDUCTOR and CTS Eventim.
Diversification Opportunities for ELMOS SEMICONDUCTOR and CTS Eventim
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ELMOS and CTS is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding ELMOS SEMICONDUCTOR and CTS Eventim AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTS Eventim AG and ELMOS SEMICONDUCTOR 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 ELMOS SEMICONDUCTOR are associated (or correlated) with CTS Eventim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTS Eventim AG has no effect on the direction of ELMOS SEMICONDUCTOR i.e., ELMOS SEMICONDUCTOR and CTS Eventim go up and down completely randomly.
Pair Corralation between ELMOS SEMICONDUCTOR and CTS Eventim
Assuming the 90 days trading horizon ELMOS SEMICONDUCTOR is expected to generate 1.51 times more return on investment than CTS Eventim. However, ELMOS SEMICONDUCTOR is 1.51 times more volatile than CTS Eventim AG. It trades about -0.01 of its potential returns per unit of risk. CTS Eventim AG is currently generating about -0.03 per unit of risk. If you would invest 7,040 in ELMOS SEMICONDUCTOR on September 12, 2024 and sell it today you would lose (370.00) from holding ELMOS SEMICONDUCTOR or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
ELMOS SEMICONDUCTOR vs. CTS Eventim AG
Performance |
| Timeline |
| ELMOS SEMICONDUCTOR |
| CTS Eventim AG |
ELMOS SEMICONDUCTOR and CTS Eventim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ELMOS SEMICONDUCTOR and CTS Eventim
The main advantage of trading using opposite ELMOS SEMICONDUCTOR and CTS Eventim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ELMOS SEMICONDUCTOR position performs unexpectedly, CTS Eventim 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 CTS Eventim will offset losses from the drop in CTS Eventim's long position.| ELMOS SEMICONDUCTOR vs. Apple Inc | ELMOS SEMICONDUCTOR vs. Apple Inc | ELMOS SEMICONDUCTOR vs. Apple Inc | ELMOS SEMICONDUCTOR vs. Apple Inc |
| CTS Eventim vs. Silicon Motion Technology | CTS Eventim vs. Shin Etsu Chemical Co | CTS Eventim vs. Solstad Offshore ASA | CTS Eventim vs. Eidesvik Offshore ASA |
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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