Correlation Between Ecclesiastical Insurance and Schweiter Technologies
Can any of the company-specific risk be diversified away by investing in both Ecclesiastical Insurance and Schweiter Technologies 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 Ecclesiastical Insurance and Schweiter Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecclesiastical Insurance Office and Schweiter Technologies AG, you can compare the effects of market volatilities on Ecclesiastical Insurance and Schweiter Technologies 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 Ecclesiastical Insurance with a short position of Schweiter Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecclesiastical Insurance and Schweiter Technologies.
Diversification Opportunities for Ecclesiastical Insurance and Schweiter Technologies
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ecclesiastical and Schweiter is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Ecclesiastical Insurance Offic and Schweiter Technologies AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schweiter Technologies and Ecclesiastical Insurance 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 Ecclesiastical Insurance Office are associated (or correlated) with Schweiter Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schweiter Technologies has no effect on the direction of Ecclesiastical Insurance i.e., Ecclesiastical Insurance and Schweiter Technologies go up and down completely randomly.
Pair Corralation between Ecclesiastical Insurance and Schweiter Technologies
Assuming the 90 days trading horizon Ecclesiastical Insurance Office is expected to generate 0.45 times more return on investment than Schweiter Technologies. However, Ecclesiastical Insurance Office is 2.23 times less risky than Schweiter Technologies. It trades about 0.06 of its potential returns per unit of risk. Schweiter Technologies AG is currently generating about -0.03 per unit of risk. If you would invest 11,945 in Ecclesiastical Insurance Office on September 2, 2024 and sell it today you would earn a total of 1,455 from holding Ecclesiastical Insurance Office or generate 12.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Ecclesiastical Insurance Offic vs. Schweiter Technologies AG
Performance |
| Timeline |
| Ecclesiastical Insurance |
| Schweiter Technologies |
Ecclesiastical Insurance and Schweiter Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecclesiastical Insurance and Schweiter Technologies
The main advantage of trading using opposite Ecclesiastical Insurance and Schweiter Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecclesiastical Insurance position performs unexpectedly, Schweiter Technologies 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 Schweiter Technologies will offset losses from the drop in Schweiter Technologies' long position.| Ecclesiastical Insurance vs. Toyota Motor Corp | Ecclesiastical Insurance vs. SoftBank Group Corp | Ecclesiastical Insurance vs. Fannie Mae | Ecclesiastical Insurance vs. Apple Inc |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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