Correlation Between HAMMONIA Schiffsholding and Sartorius Stedim
Can any of the company-specific risk be diversified away by investing in both HAMMONIA Schiffsholding and Sartorius Stedim 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 HAMMONIA Schiffsholding and Sartorius Stedim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HAMMONIA Schiffsholding AG and Sartorius Stedim Biotech, you can compare the effects of market volatilities on HAMMONIA Schiffsholding and Sartorius Stedim 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 HAMMONIA Schiffsholding with a short position of Sartorius Stedim. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAMMONIA Schiffsholding and Sartorius Stedim.
Diversification Opportunities for HAMMONIA Schiffsholding and Sartorius Stedim
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HAMMONIA and Sartorius is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding HAMMONIA Schiffsholding AG and Sartorius Stedim Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sartorius Stedim Biotech and HAMMONIA Schiffsholding 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 HAMMONIA Schiffsholding AG are associated (or correlated) with Sartorius Stedim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sartorius Stedim Biotech has no effect on the direction of HAMMONIA Schiffsholding i.e., HAMMONIA Schiffsholding and Sartorius Stedim go up and down completely randomly.
Pair Corralation between HAMMONIA Schiffsholding and Sartorius Stedim
Assuming the 90 days trading horizon HAMMONIA Schiffsholding AG is expected to generate 0.86 times more return on investment than Sartorius Stedim. However, HAMMONIA Schiffsholding AG is 1.16 times less risky than Sartorius Stedim. It trades about 0.03 of its potential returns per unit of risk. Sartorius Stedim Biotech is currently generating about -0.03 per unit of risk. If you would invest 26,200 in HAMMONIA Schiffsholding AG on August 26, 2024 and sell it today you would earn a total of 3,600 from holding HAMMONIA Schiffsholding AG or generate 13.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HAMMONIA Schiffsholding AG vs. Sartorius Stedim Biotech
Performance |
| Timeline |
| HAMMONIA Schiffsholding |
| Sartorius Stedim Biotech |
HAMMONIA Schiffsholding and Sartorius Stedim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HAMMONIA Schiffsholding and Sartorius Stedim
The main advantage of trading using opposite HAMMONIA Schiffsholding and Sartorius Stedim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HAMMONIA Schiffsholding position performs unexpectedly, Sartorius Stedim 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 Sartorius Stedim will offset losses from the drop in Sartorius Stedim's long position.| HAMMONIA Schiffsholding vs. Nippon Yusen Kabushiki | HAMMONIA Schiffsholding vs. Orient Overseas Limited | HAMMONIA Schiffsholding vs. COSCO SHIPPING Energy | HAMMONIA Schiffsholding vs. China Merchants Port |
| Sartorius Stedim vs. PT Global Mediacom | Sartorius Stedim vs. Live Nation Entertainment | Sartorius Stedim vs. Aegean Airlines SA | Sartorius Stedim vs. Townsquare Media |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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