Correlation Between Linedata Services and Materialise
Can any of the company-specific risk be diversified away by investing in both Linedata Services and Materialise 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 Linedata Services and Materialise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Linedata Services SA and Materialise NV, you can compare the effects of market volatilities on Linedata Services and Materialise 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 Linedata Services with a short position of Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Linedata Services and Materialise.
Diversification Opportunities for Linedata Services and Materialise
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Linedata and Materialise is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Linedata Services SA and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV and Linedata Services 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 Linedata Services SA are associated (or correlated) with Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of Linedata Services i.e., Linedata Services and Materialise go up and down completely randomly.
Pair Corralation between Linedata Services and Materialise
Assuming the 90 days trading horizon Linedata Services SA is expected to generate 0.57 times more return on investment than Materialise. However, Linedata Services SA is 1.77 times less risky than Materialise. It trades about 0.08 of its potential returns per unit of risk. Materialise NV is currently generating about 0.0 per unit of risk. If you would invest 4,459 in Linedata Services SA on October 13, 2024 and sell it today you would earn a total of 3,941 from holding Linedata Services SA or generate 88.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Linedata Services SA vs. Materialise NV
Performance |
| Timeline |
| Linedata Services |
| Materialise NV |
Linedata Services and Materialise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Linedata Services and Materialise
The main advantage of trading using opposite Linedata Services and Materialise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Linedata Services position performs unexpectedly, Materialise 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 Materialise will offset losses from the drop in Materialise's long position.| Linedata Services vs. Apple Inc | Linedata Services vs. Apple Inc | Linedata Services vs. Apple Inc | Linedata Services vs. Apple Inc |
| Materialise vs. Linedata Services SA | Materialise vs. Cairo Communication SpA | Materialise vs. Singapore Telecommunications Limited | Materialise vs. China Datang |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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