Correlation Between HOYA and SARTORIUS
Can any of the company-specific risk be diversified away by investing in both HOYA and SARTORIUS 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 HOYA and SARTORIUS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HOYA Corporation and SARTORIUS AG UNSPADR, you can compare the effects of market volatilities on HOYA and SARTORIUS 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 HOYA with a short position of SARTORIUS. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOYA and SARTORIUS.
Diversification Opportunities for HOYA and SARTORIUS
Poor diversification
The 3 months correlation between HOYA and SARTORIUS is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding HOYA Corp. and SARTORIUS AG UNSPADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SARTORIUS AG UNSPADR and HOYA 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 HOYA Corporation are associated (or correlated) with SARTORIUS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SARTORIUS AG UNSPADR has no effect on the direction of HOYA i.e., HOYA and SARTORIUS go up and down completely randomly.
Pair Corralation between HOYA and SARTORIUS
Assuming the 90 days horizon HOYA is expected to generate 3.18 times less return on investment than SARTORIUS. But when comparing it to its historical volatility, HOYA Corporation is 1.86 times less risky than SARTORIUS. It trades about 0.3 of its potential returns per unit of risk. SARTORIUS AG UNSPADR is currently generating about 0.51 of returns per unit of risk over similar time horizon. If you would invest 3,300 in SARTORIUS AG UNSPADR on November 1, 2024 and sell it today you would earn a total of 1,080 from holding SARTORIUS AG UNSPADR or generate 32.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HOYA Corp. vs. SARTORIUS AG UNSPADR
Performance |
| Timeline |
| HOYA |
| SARTORIUS AG UNSPADR |
HOYA and SARTORIUS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HOYA and SARTORIUS
The main advantage of trading using opposite HOYA and SARTORIUS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HOYA position performs unexpectedly, SARTORIUS 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 will offset losses from the drop in SARTORIUS's long position.| HOYA vs. UPDATE SOFTWARE | HOYA vs. Marie Brizard Wine | HOYA vs. Take Two Interactive Software | HOYA vs. ITALIAN WINE BRANDS |
| SARTORIUS vs. ESSILORLUXOTTICA 12ON | SARTORIUS vs. Becton Dickinson and | SARTORIUS vs. HOYA Corporation | SARTORIUS vs. Sartorius Stedim Biotech |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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