Correlation Between Liechtensteinische and Xlife Sciences
Can any of the company-specific risk be diversified away by investing in both Liechtensteinische and Xlife Sciences 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 Liechtensteinische and Xlife Sciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liechtensteinische Landesbank AG and Xlife Sciences AG, you can compare the effects of market volatilities on Liechtensteinische and Xlife Sciences 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 Liechtensteinische with a short position of Xlife Sciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liechtensteinische and Xlife Sciences.
Diversification Opportunities for Liechtensteinische and Xlife Sciences
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Liechtensteinische and Xlife is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Liechtensteinische Landesbank and Xlife Sciences AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xlife Sciences AG and Liechtensteinische 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 Liechtensteinische Landesbank AG are associated (or correlated) with Xlife Sciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xlife Sciences AG has no effect on the direction of Liechtensteinische i.e., Liechtensteinische and Xlife Sciences go up and down completely randomly.
Pair Corralation between Liechtensteinische and Xlife Sciences
Assuming the 90 days trading horizon Liechtensteinische Landesbank AG is expected to under-perform the Xlife Sciences. But the stock apears to be less risky and, when comparing its historical volatility, Liechtensteinische Landesbank AG is 5.72 times less risky than Xlife Sciences. The stock trades about -0.1 of its potential returns per unit of risk. The Xlife Sciences AG is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,800 in Xlife Sciences AG on September 4, 2024 and sell it today you would lose (180.00) from holding Xlife Sciences AG or give up 6.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liechtensteinische Landesbank vs. Xlife Sciences AG
Performance |
| Timeline |
| Liechtensteinische |
| Xlife Sciences AG |
Liechtensteinische and Xlife Sciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liechtensteinische and Xlife Sciences
The main advantage of trading using opposite Liechtensteinische and Xlife Sciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liechtensteinische position performs unexpectedly, Xlife Sciences 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 Xlife Sciences will offset losses from the drop in Xlife Sciences' long position.| Liechtensteinische vs. VP Bank AG | Liechtensteinische vs. Valiant Holding AG | Liechtensteinische vs. Glarner Kantonalbank | Liechtensteinische vs. Berner Kantonalbank AG |
| Xlife Sciences vs. Liechtensteinische Landesbank AG | Xlife Sciences vs. Luzerner Kantonalbank AG | Xlife Sciences vs. Schweizerische Nationalbank | Xlife Sciences vs. St Galler Kantonalbank |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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