Correlation Between GrafTech International and Delta Electronics
Can any of the company-specific risk be diversified away by investing in both GrafTech International and Delta Electronics 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 GrafTech International and Delta Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GrafTech International and Delta Electronics Public, you can compare the effects of market volatilities on GrafTech International and Delta Electronics 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 GrafTech International with a short position of Delta Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of GrafTech International and Delta Electronics.
Diversification Opportunities for GrafTech International and Delta Electronics
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GrafTech and Delta is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding GrafTech International and Delta Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Electronics Public and GrafTech International 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 GrafTech International are associated (or correlated) with Delta Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Electronics Public has no effect on the direction of GrafTech International i.e., GrafTech International and Delta Electronics go up and down completely randomly.
Pair Corralation between GrafTech International and Delta Electronics
Assuming the 90 days horizon GrafTech International is expected to under-perform the Delta Electronics. In addition to that, GrafTech International is 1.65 times more volatile than Delta Electronics Public. It trades about -0.22 of its total potential returns per unit of risk. Delta Electronics Public is currently generating about 0.07 per unit of volatility. If you would invest 394.00 in Delta Electronics Public on September 25, 2024 and sell it today you would earn a total of 14.00 from holding Delta Electronics Public or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GrafTech International vs. Delta Electronics Public
Performance |
| Timeline |
| GrafTech International |
| Delta Electronics Public |
GrafTech International and Delta Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GrafTech International and Delta Electronics
The main advantage of trading using opposite GrafTech International and Delta Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GrafTech International position performs unexpectedly, Delta Electronics 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 Delta Electronics will offset losses from the drop in Delta Electronics' long position.| GrafTech International vs. Delta Electronics Public | GrafTech International vs. YASKAWA ELEC UNSP | GrafTech International vs. Plug Power | GrafTech International vs. VERTIV HOLCL A |
| Delta Electronics vs. YASKAWA ELEC UNSP | Delta Electronics vs. Plug Power | Delta Electronics vs. VERTIV HOLCL A | Delta Electronics vs. OSRAM LICHT N |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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