Correlation Between Sixt Leasing and FIRSTRAND
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and FIRSTRAND 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 FIRSTRAND 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 FIRSTRAND, you can compare the effects of market volatilities on Sixt Leasing and FIRSTRAND 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 FIRSTRAND. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and FIRSTRAND.
Diversification Opportunities for Sixt Leasing and FIRSTRAND
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sixt and FIRSTRAND is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and FIRSTRAND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRSTRAND 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 FIRSTRAND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRSTRAND has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and FIRSTRAND go up and down completely randomly.
Pair Corralation between Sixt Leasing and FIRSTRAND
Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the FIRSTRAND. In addition to that, Sixt Leasing is 2.01 times more volatile than FIRSTRAND. It trades about -0.1 of its total potential returns per unit of risk. FIRSTRAND is currently generating about 0.21 per unit of volatility. If you would invest 400.00 in FIRSTRAND on September 12, 2024 and sell it today you would earn a total of 24.00 from holding FIRSTRAND or generate 6.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. FIRSTRAND
Performance |
| Timeline |
| Sixt Leasing SE |
| FIRSTRAND |
Sixt Leasing and FIRSTRAND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and FIRSTRAND
The main advantage of trading using opposite Sixt Leasing and FIRSTRAND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, FIRSTRAND 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 FIRSTRAND will offset losses from the drop in FIRSTRAND's long position.| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
| FIRSTRAND vs. HYDROFARM HLD GRP | FIRSTRAND vs. Granite Construction | FIRSTRAND vs. AGRICULTBK HADR25 YC | FIRSTRAND vs. North American Construction |
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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