Correlation Between IShares European and Jungfraubahn Holding
Can any of the company-specific risk be diversified away by investing in both IShares European and Jungfraubahn Holding 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 IShares European and Jungfraubahn Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares European Property and Jungfraubahn Holding AG, you can compare the effects of market volatilities on IShares European and Jungfraubahn Holding 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 IShares European with a short position of Jungfraubahn Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares European and Jungfraubahn Holding.
Diversification Opportunities for IShares European and Jungfraubahn Holding
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and Jungfraubahn is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding iShares European Property and Jungfraubahn Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jungfraubahn Holding and IShares European 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 iShares European Property are associated (or correlated) with Jungfraubahn Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jungfraubahn Holding has no effect on the direction of IShares European i.e., IShares European and Jungfraubahn Holding go up and down completely randomly.
Pair Corralation between IShares European and Jungfraubahn Holding
Assuming the 90 days trading horizon iShares European Property is expected to generate 0.84 times more return on investment than Jungfraubahn Holding. However, iShares European Property is 1.19 times less risky than Jungfraubahn Holding. It trades about 0.04 of its potential returns per unit of risk. Jungfraubahn Holding AG is currently generating about 0.03 per unit of risk. If you would invest 2,492 in iShares European Property on September 14, 2024 and sell it today you would earn a total of 257.00 from holding iShares European Property or generate 10.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares European Property vs. Jungfraubahn Holding AG
Performance |
| Timeline |
| iShares European Property |
| Jungfraubahn Holding |
IShares European and Jungfraubahn Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares European and Jungfraubahn Holding
The main advantage of trading using opposite IShares European and Jungfraubahn Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares European position performs unexpectedly, Jungfraubahn Holding 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 Jungfraubahn Holding will offset losses from the drop in Jungfraubahn Holding's long position.| IShares European vs. Baloise Holding AG | IShares European vs. 21Shares Polkadot ETP | IShares European vs. UBS ETF MSCI | IShares European vs. BB Biotech AG |
| Jungfraubahn Holding vs. Emmi AG | Jungfraubahn Holding vs. Flughafen Zurich | Jungfraubahn Holding vs. Bergbahnen Engelberg Truebsee | Jungfraubahn Holding vs. EMS CHEMIE 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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