Correlation Between Helvetia Holding and Bell AG
Can any of the company-specific risk be diversified away by investing in both Helvetia Holding and Bell AG 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 Helvetia Holding and Bell AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Helvetia Holding AG and Bell AG, you can compare the effects of market volatilities on Helvetia Holding and Bell AG 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 Helvetia Holding with a short position of Bell AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helvetia Holding and Bell AG.
Diversification Opportunities for Helvetia Holding and Bell AG
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Helvetia and Bell is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Helvetia Holding AG and Bell AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bell AG and Helvetia Holding 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 Helvetia Holding AG are associated (or correlated) with Bell AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bell AG has no effect on the direction of Helvetia Holding i.e., Helvetia Holding and Bell AG go up and down completely randomly.
Pair Corralation between Helvetia Holding and Bell AG
Assuming the 90 days trading horizon Helvetia Holding AG is expected to generate 0.89 times more return on investment than Bell AG. However, Helvetia Holding AG is 1.12 times less risky than Bell AG. It trades about 0.13 of its potential returns per unit of risk. Bell AG is currently generating about 0.0 per unit of risk. If you would invest 11,205 in Helvetia Holding AG on September 2, 2024 and sell it today you would earn a total of 4,235 from holding Helvetia Holding AG or generate 37.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Helvetia Holding AG vs. Bell AG
Performance |
| Timeline |
| Helvetia Holding |
| Bell AG |
Helvetia Holding and Bell AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Helvetia Holding and Bell AG
The main advantage of trading using opposite Helvetia Holding and Bell AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Helvetia Holding position performs unexpectedly, Bell AG 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 Bell AG will offset losses from the drop in Bell AG's long position.| Helvetia Holding vs. Swiss Life Holding | Helvetia Holding vs. Baloise Holding AG | Helvetia Holding vs. Swiss Re AG | Helvetia Holding vs. Zurich Insurance Group |
| Bell AG vs. Emmi AG | Bell AG vs. Feintool International Holding | Bell AG vs. Implenia AG | Bell AG vs. Bossard Holding 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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