Correlation Between Hypothekarbank Lenzburg and Cembra Money
Can any of the company-specific risk be diversified away by investing in both Hypothekarbank Lenzburg and Cembra Money 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 Hypothekarbank Lenzburg and Cembra Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hypothekarbank Lenzburg AG and Cembra Money Bank, you can compare the effects of market volatilities on Hypothekarbank Lenzburg and Cembra Money 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 Hypothekarbank Lenzburg with a short position of Cembra Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hypothekarbank Lenzburg and Cembra Money.
Diversification Opportunities for Hypothekarbank Lenzburg and Cembra Money
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hypothekarbank and Cembra is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hypothekarbank Lenzburg AG and Cembra Money Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cembra Money Bank and Hypothekarbank Lenzburg 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 Hypothekarbank Lenzburg AG are associated (or correlated) with Cembra Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cembra Money Bank has no effect on the direction of Hypothekarbank Lenzburg i.e., Hypothekarbank Lenzburg and Cembra Money go up and down completely randomly.
Pair Corralation between Hypothekarbank Lenzburg and Cembra Money
Assuming the 90 days trading horizon Hypothekarbank Lenzburg AG is expected to under-perform the Cembra Money. But the stock apears to be less risky and, when comparing its historical volatility, Hypothekarbank Lenzburg AG is 1.23 times less risky than Cembra Money. The stock trades about -0.07 of its potential returns per unit of risk. The Cembra Money Bank is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 7,870 in Cembra Money Bank on August 28, 2024 and sell it today you would earn a total of 250.00 from holding Cembra Money Bank or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hypothekarbank Lenzburg AG vs. Cembra Money Bank
Performance |
| Timeline |
| Hypothekarbank Lenzburg |
| Cembra Money Bank |
Hypothekarbank Lenzburg and Cembra Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hypothekarbank Lenzburg and Cembra Money
The main advantage of trading using opposite Hypothekarbank Lenzburg and Cembra Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hypothekarbank Lenzburg position performs unexpectedly, Cembra Money 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 Cembra Money will offset losses from the drop in Cembra Money's long position.| Hypothekarbank Lenzburg vs. Luzerner Kantonalbank AG | Hypothekarbank Lenzburg vs. Graubuendner Kantonalbank | Hypothekarbank Lenzburg vs. CPH Chemie und | Hypothekarbank Lenzburg vs. Berner Kantonalbank AG |
| Cembra Money vs. Banque Cantonale | Cembra Money vs. St Galler Kantonalbank | Cembra Money vs. PSP Swiss Property | Cembra Money vs. Berner Kantonalbank 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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