Correlation Between Interroll Holding and Elma Electronic
Can any of the company-specific risk be diversified away by investing in both Interroll Holding and Elma Electronic 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 Interroll Holding and Elma Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Interroll Holding AG and Elma Electronic AG, you can compare the effects of market volatilities on Interroll Holding and Elma Electronic 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 Interroll Holding with a short position of Elma Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interroll Holding and Elma Electronic.
Diversification Opportunities for Interroll Holding and Elma Electronic
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Interroll and Elma is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Interroll Holding AG and Elma Electronic AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elma Electronic AG and Interroll 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 Interroll Holding AG are associated (or correlated) with Elma Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elma Electronic AG has no effect on the direction of Interroll Holding i.e., Interroll Holding and Elma Electronic go up and down completely randomly.
Pair Corralation between Interroll Holding and Elma Electronic
Assuming the 90 days trading horizon Interroll Holding AG is expected to under-perform the Elma Electronic. In addition to that, Interroll Holding is 3.45 times more volatile than Elma Electronic AG. It trades about -0.11 of its total potential returns per unit of risk. Elma Electronic AG is currently generating about 0.5 per unit of volatility. If you would invest 104,000 in Elma Electronic AG on September 1, 2024 and sell it today you would earn a total of 1,000.00 from holding Elma Electronic AG or generate 0.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 17.39% |
| Values | Daily Returns |
Interroll Holding AG vs. Elma Electronic AG
Performance |
| Timeline |
| Interroll Holding |
| Elma Electronic AG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Interroll Holding and Elma Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Interroll Holding and Elma Electronic
The main advantage of trading using opposite Interroll Holding and Elma Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interroll Holding position performs unexpectedly, Elma Electronic 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 Elma Electronic will offset losses from the drop in Elma Electronic's long position.| Interroll Holding vs. Belimo Holding | Interroll Holding vs. Bachem Holding AG | Interroll Holding vs. VAT Group AG | Interroll Holding vs. Kardex |
| Elma Electronic vs. Inficon Holding | Elma Electronic vs. Belimo Holding | Elma Electronic vs. Interroll Holding AG | Elma Electronic vs. Comet 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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