Correlation Between Sixt Leasing and SK TELECOM
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and SK TELECOM 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 SK TELECOM 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 SK TELECOM TDADR, you can compare the effects of market volatilities on Sixt Leasing and SK TELECOM 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 SK TELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and SK TELECOM.
Diversification Opportunities for Sixt Leasing and SK TELECOM
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sixt and KMBA is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and SK TELECOM TDADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK TELECOM TDADR 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 SK TELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK TELECOM TDADR has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and SK TELECOM go up and down completely randomly.
Pair Corralation between Sixt Leasing and SK TELECOM
Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the SK TELECOM. But the stock apears to be less risky and, when comparing its historical volatility, Sixt Leasing SE is 1.75 times less risky than SK TELECOM. The stock trades about -0.2 of its potential returns per unit of risk. The SK TELECOM TDADR is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 2,120 in SK TELECOM TDADR on August 25, 2024 and sell it today you would lose (80.00) from holding SK TELECOM TDADR or give up 3.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. SK TELECOM TDADR
Performance |
| Timeline |
| Sixt Leasing SE |
| SK TELECOM TDADR |
Sixt Leasing and SK TELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and SK TELECOM
The main advantage of trading using opposite Sixt Leasing and SK TELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, SK TELECOM 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 SK TELECOM will offset losses from the drop in SK TELECOM's long position.| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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