Correlation Between Leonteq AG and GAM Holding
Can any of the company-specific risk be diversified away by investing in both Leonteq AG and GAM 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 Leonteq AG and GAM Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leonteq AG and GAM Holding AG, you can compare the effects of market volatilities on Leonteq AG and GAM 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 Leonteq AG with a short position of GAM Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leonteq AG and GAM Holding.
Diversification Opportunities for Leonteq AG and GAM Holding
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Leonteq and GAM is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Leonteq AG and GAM Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAM Holding AG and Leonteq AG 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 Leonteq AG are associated (or correlated) with GAM Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAM Holding AG has no effect on the direction of Leonteq AG i.e., Leonteq AG and GAM Holding go up and down completely randomly.
Pair Corralation between Leonteq AG and GAM Holding
Assuming the 90 days trading horizon Leonteq AG is expected to under-perform the GAM Holding. But the stock apears to be less risky and, when comparing its historical volatility, Leonteq AG is 2.11 times less risky than GAM Holding. The stock trades about -0.03 of its potential returns per unit of risk. The GAM Holding AG is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 9.01 in GAM Holding AG on November 5, 2024 and sell it today you would earn a total of 0.73 from holding GAM Holding AG or generate 8.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leonteq AG vs. GAM Holding AG
Performance |
| Timeline |
| Leonteq AG |
| GAM Holding AG |
Leonteq AG and GAM Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leonteq AG and GAM Holding
The main advantage of trading using opposite Leonteq AG and GAM Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leonteq AG position performs unexpectedly, GAM 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 GAM Holding will offset losses from the drop in GAM Holding's long position.| Leonteq AG vs. Cembra Money Bank | Leonteq AG vs. OC Oerlikon Corp | Leonteq AG vs. Helvetia Holding AG | Leonteq AG vs. mobilezone ag |
| GAM Holding vs. OC Oerlikon Corp | GAM Holding vs. EFG International AG | GAM Holding vs. Julius Baer Gruppe | GAM Holding vs. Aryzta 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |