Correlation Between Global Hemp and Siemens Energy
Can any of the company-specific risk be diversified away by investing in both Global Hemp and Siemens Energy 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 Global Hemp and Siemens Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Hemp Group and Siemens Energy AG, you can compare the effects of market volatilities on Global Hemp and Siemens Energy 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 Global Hemp with a short position of Siemens Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Hemp and Siemens Energy.
Diversification Opportunities for Global Hemp and Siemens Energy
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Siemens is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Global Hemp Group and Siemens Energy AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Energy AG and Global Hemp 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 Global Hemp Group are associated (or correlated) with Siemens Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Energy AG has no effect on the direction of Global Hemp i.e., Global Hemp and Siemens Energy go up and down completely randomly.
Pair Corralation between Global Hemp and Siemens Energy
Assuming the 90 days horizon Global Hemp Group is expected to under-perform the Siemens Energy. In addition to that, Global Hemp is 2.86 times more volatile than Siemens Energy AG. It trades about -0.24 of its total potential returns per unit of risk. Siemens Energy AG is currently generating about 0.56 per unit of volatility. If you would invest 4,083 in Siemens Energy AG on September 1, 2024 and sell it today you would earn a total of 1,317 from holding Siemens Energy AG or generate 32.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Global Hemp Group vs. Siemens Energy AG
Performance |
| Timeline |
| Global Hemp Group |
| Siemens Energy AG |
Global Hemp and Siemens Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Hemp and Siemens Energy
The main advantage of trading using opposite Global Hemp and Siemens Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Hemp position performs unexpectedly, Siemens Energy 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 Siemens Energy will offset losses from the drop in Siemens Energy's long position.| Global Hemp vs. Holloman Energy Corp | Global Hemp vs. cbdMD Inc | Global Hemp vs. Evolus Inc | Global Hemp vs. CV Sciences |
| Siemens Energy vs. SPX Corp | Siemens Energy vs. Nuscale Power Corp | Siemens Energy vs. Vestas Wind Systems | Siemens Energy vs. Nordex SE |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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