Correlation Between Sixt Leasing and Telefonaktiebolaget
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and Telefonaktiebolaget 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 Sixt Leasing and Telefonaktiebolaget into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sixt Leasing SE and Telefonaktiebolaget LM Ericsson, you can compare the effects of market volatilities on Sixt Leasing and Telefonaktiebolaget 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 Sixt Leasing with a short position of Telefonaktiebolaget. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and Telefonaktiebolaget.
Diversification Opportunities for Sixt Leasing and Telefonaktiebolaget
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sixt and Telefonaktiebolaget is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Telefonaktiebolaget LM Ericsso in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telefonaktiebolaget and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Telefonaktiebolaget. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telefonaktiebolaget has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Telefonaktiebolaget go up and down completely randomly.
Pair Corralation between Sixt Leasing and Telefonaktiebolaget
Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the Telefonaktiebolaget. But the stock apears to be less risky and, when comparing its historical volatility, Sixt Leasing SE is 2.09 times less risky than Telefonaktiebolaget. The stock trades about -0.02 of its potential returns per unit of risk. The Telefonaktiebolaget LM Ericsson is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 183.00 in Telefonaktiebolaget LM Ericsson on November 5, 2024 and sell it today you would earn a total of 555.00 from holding Telefonaktiebolaget LM Ericsson or generate 303.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. Telefonaktiebolaget LM Ericsso
Performance |
| Timeline |
| Sixt Leasing SE |
| Telefonaktiebolaget |
Sixt Leasing and Telefonaktiebolaget Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and Telefonaktiebolaget
The main advantage of trading using opposite Sixt Leasing and Telefonaktiebolaget positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, Telefonaktiebolaget 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 Telefonaktiebolaget will offset losses from the drop in Telefonaktiebolaget's long position.| Sixt Leasing vs. Siemens Healthineers AG | Sixt Leasing vs. Phibro Animal Health | Sixt Leasing vs. PURETECH HEALTH PLC | Sixt Leasing vs. EPSILON HEALTHCARE LTD |
| Telefonaktiebolaget vs. Endeavour Mining PLC | Telefonaktiebolaget vs. OPKO HEALTH | Telefonaktiebolaget vs. EPSILON HEALTHCARE LTD | Telefonaktiebolaget vs. Wenzhou Kangning Hospital |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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