Correlation Between Helvetia Holding and Basler Kantonalbank
Can any of the company-specific risk be diversified away by investing in both Helvetia Holding and Basler Kantonalbank 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 Basler Kantonalbank 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 Basler Kantonalbank, you can compare the effects of market volatilities on Helvetia Holding and Basler Kantonalbank 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 Basler Kantonalbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helvetia Holding and Basler Kantonalbank.
Diversification Opportunities for Helvetia Holding and Basler Kantonalbank
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Helvetia and Basler is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Helvetia Holding AG and Basler Kantonalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basler Kantonalbank 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 Basler Kantonalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basler Kantonalbank has no effect on the direction of Helvetia Holding i.e., Helvetia Holding and Basler Kantonalbank go up and down completely randomly.
Pair Corralation between Helvetia Holding and Basler Kantonalbank
Assuming the 90 days trading horizon Helvetia Holding AG is expected to generate 0.72 times more return on investment than Basler Kantonalbank. However, Helvetia Holding AG is 1.39 times less risky than Basler Kantonalbank. It trades about 0.24 of its potential returns per unit of risk. Basler Kantonalbank is currently generating about 0.15 per unit of risk. If you would invest 15,390 in Helvetia Holding AG on November 5, 2024 and sell it today you would earn a total of 560.00 from holding Helvetia Holding AG or generate 3.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Helvetia Holding AG vs. Basler Kantonalbank
Performance |
| Timeline |
| Helvetia Holding |
| Basler Kantonalbank |
Helvetia Holding and Basler Kantonalbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Helvetia Holding and Basler Kantonalbank
The main advantage of trading using opposite Helvetia Holding and Basler Kantonalbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Helvetia Holding position performs unexpectedly, Basler Kantonalbank 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 Basler Kantonalbank will offset losses from the drop in Basler Kantonalbank'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 |
| Basler Kantonalbank vs. Banque Cantonale | Basler Kantonalbank vs. Berner Kantonalbank AG | Basler Kantonalbank vs. Luzerner Kantonalbank AG | Basler Kantonalbank vs. Banque Cantonale de |
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 Stocks Directory module to find actively traded stocks across global markets.
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