Correlation Between Sixt Leasing and United Internet
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and United Internet 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 United Internet 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 United Internet AG, you can compare the effects of market volatilities on Sixt Leasing and United Internet 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 United Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and United Internet.
Diversification Opportunities for Sixt Leasing and United Internet
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sixt and United is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and United Internet AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Internet AG 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 United Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Internet AG has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and United Internet go up and down completely randomly.
Pair Corralation between Sixt Leasing and United Internet
Assuming the 90 days trading horizon Sixt Leasing SE is expected to generate 1.84 times more return on investment than United Internet. However, Sixt Leasing is 1.84 times more volatile than United Internet AG. It trades about 0.06 of its potential returns per unit of risk. United Internet AG is currently generating about -0.12 per unit of risk. If you would invest 920.00 in Sixt Leasing SE on September 25, 2024 and sell it today you would earn a total of 20.00 from holding Sixt Leasing SE or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. United Internet AG
Performance |
| Timeline |
| Sixt Leasing SE |
| United Internet AG |
Sixt Leasing and United Internet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and United Internet
The main advantage of trading using opposite Sixt Leasing and United Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, United Internet 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 United Internet will offset losses from the drop in United Internet's long position.| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
| United Internet vs. T Mobile | United Internet vs. ATT Inc | United Internet vs. ATT Inc | United Internet vs. Deutsche Telekom AG |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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