Correlation Between Mercedes-Benz Group and PROQR THERAPEUTICS
Can any of the company-specific risk be diversified away by investing in both Mercedes-Benz Group and PROQR THERAPEUTICS 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 Mercedes-Benz Group and PROQR THERAPEUTICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mercedes Benz Group AG and PROQR THERAPEUTICS EO 04, you can compare the effects of market volatilities on Mercedes-Benz Group and PROQR THERAPEUTICS 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 Mercedes-Benz Group with a short position of PROQR THERAPEUTICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercedes-Benz Group and PROQR THERAPEUTICS.
Diversification Opportunities for Mercedes-Benz Group and PROQR THERAPEUTICS
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mercedes-Benz and PROQR is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Mercedes Benz Group AG and PROQR THERAPEUTICS EO 04 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROQR THERAPEUTICS and Mercedes-Benz Group 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 Mercedes Benz Group AG are associated (or correlated) with PROQR THERAPEUTICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROQR THERAPEUTICS has no effect on the direction of Mercedes-Benz Group i.e., Mercedes-Benz Group and PROQR THERAPEUTICS go up and down completely randomly.
Pair Corralation between Mercedes-Benz Group and PROQR THERAPEUTICS
Assuming the 90 days horizon Mercedes-Benz Group is expected to generate 2015.0 times less return on investment than PROQR THERAPEUTICS. But when comparing it to its historical volatility, Mercedes Benz Group AG is 6.19 times less risky than PROQR THERAPEUTICS. It trades about 0.0 of its potential returns per unit of risk. PROQR THERAPEUTICS EO 04 is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 143.00 in PROQR THERAPEUTICS EO 04 on September 2, 2024 and sell it today you would earn a total of 197.00 from holding PROQR THERAPEUTICS EO 04 or generate 137.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mercedes Benz Group AG vs. PROQR THERAPEUTICS EO 04
Performance |
| Timeline |
| Mercedes Benz Group |
| PROQR THERAPEUTICS |
Mercedes-Benz Group and PROQR THERAPEUTICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mercedes-Benz Group and PROQR THERAPEUTICS
The main advantage of trading using opposite Mercedes-Benz Group and PROQR THERAPEUTICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercedes-Benz Group position performs unexpectedly, PROQR THERAPEUTICS 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 PROQR THERAPEUTICS will offset losses from the drop in PROQR THERAPEUTICS's long position.| Mercedes-Benz Group vs. Geely Automobile Holdings | Mercedes-Benz Group vs. PRECISION DRILLING P | Mercedes-Benz Group vs. TAL Education Group | Mercedes-Benz Group vs. INTER CARS SA |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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