Correlation Between Jungfraubahn Holding and Flow Traders
Can any of the company-specific risk be diversified away by investing in both Jungfraubahn Holding and Flow Traders 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 Jungfraubahn Holding and Flow Traders into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jungfraubahn Holding AG and Flow Traders BV, you can compare the effects of market volatilities on Jungfraubahn Holding and Flow Traders 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 Jungfraubahn Holding with a short position of Flow Traders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jungfraubahn Holding and Flow Traders.
Diversification Opportunities for Jungfraubahn Holding and Flow Traders
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jungfraubahn and Flow is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Jungfraubahn Holding AG and Flow Traders BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flow Traders BV and Jungfraubahn 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 Jungfraubahn Holding AG are associated (or correlated) with Flow Traders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flow Traders BV has no effect on the direction of Jungfraubahn Holding i.e., Jungfraubahn Holding and Flow Traders go up and down completely randomly.
Pair Corralation between Jungfraubahn Holding and Flow Traders
Assuming the 90 days trading horizon Jungfraubahn Holding AG is expected to generate 0.74 times more return on investment than Flow Traders. However, Jungfraubahn Holding AG is 1.36 times less risky than Flow Traders. It trades about 0.06 of its potential returns per unit of risk. Flow Traders BV is currently generating about 0.03 per unit of risk. If you would invest 12,621 in Jungfraubahn Holding AG on November 29, 2024 and sell it today you would earn a total of 5,979 from holding Jungfraubahn Holding AG or generate 47.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.21% |
| Values | Daily Returns |
Jungfraubahn Holding AG vs. Flow Traders BV
Performance |
| Timeline |
| Jungfraubahn Holding |
| Flow Traders BV |
Jungfraubahn Holding and Flow Traders Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jungfraubahn Holding and Flow Traders
The main advantage of trading using opposite Jungfraubahn Holding and Flow Traders positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jungfraubahn Holding position performs unexpectedly, Flow Traders 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 Flow Traders will offset losses from the drop in Flow Traders' long position.| Jungfraubahn Holding vs. Emmi AG | Jungfraubahn Holding vs. Flughafen Zurich | Jungfraubahn Holding vs. Bergbahnen Engelberg Truebsee | Jungfraubahn Holding vs. EMS CHEMIE HOLDING AG |
| Flow Traders vs. NN Group NV | Flow Traders vs. BE Semiconductor Industries | Flow Traders vs. Koninklijke Ahold Delhaize | Flow Traders vs. ASR Nederland NV |
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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