Correlation Between Methode Electronics and INTERSHOP Communications
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By analyzing existing cross correlation between Methode Electronics and INTERSHOP Communications Aktiengesellschaft, you can compare the effects of market volatilities on Methode Electronics and INTERSHOP Communications 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 Methode Electronics with a short position of INTERSHOP Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Methode Electronics and INTERSHOP Communications.
Diversification Opportunities for Methode Electronics and INTERSHOP Communications
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Methode and INTERSHOP is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Methode Electronics and INTERSHOP Communications Aktie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTERSHOP Communications and Methode Electronics 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 Methode Electronics are associated (or correlated) with INTERSHOP Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTERSHOP Communications has no effect on the direction of Methode Electronics i.e., Methode Electronics and INTERSHOP Communications go up and down completely randomly.
Pair Corralation between Methode Electronics and INTERSHOP Communications
Assuming the 90 days trading horizon Methode Electronics is expected to generate 2.51 times more return on investment than INTERSHOP Communications. However, Methode Electronics is 2.51 times more volatile than INTERSHOP Communications Aktiengesellschaft. It trades about 0.01 of its potential returns per unit of risk. INTERSHOP Communications Aktiengesellschaft is currently generating about -0.01 per unit of risk. If you would invest 1,043 in Methode Electronics on August 30, 2024 and sell it today you would lose (58.00) from holding Methode Electronics or give up 5.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Methode Electronics vs. INTERSHOP Communications Aktie
Performance |
| Timeline |
| Methode Electronics |
| INTERSHOP Communications |
Methode Electronics and INTERSHOP Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Methode Electronics and INTERSHOP Communications
The main advantage of trading using opposite Methode Electronics and INTERSHOP Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Methode Electronics position performs unexpectedly, INTERSHOP Communications 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 INTERSHOP Communications will offset losses from the drop in INTERSHOP Communications' long position.| Methode Electronics vs. GREENX METALS LTD | Methode Electronics vs. Zurich Insurance Group | Methode Electronics vs. SERI INDUSTRIAL EO | Methode Electronics vs. MCEWEN MINING INC |
| INTERSHOP Communications vs. SAP SE | INTERSHOP Communications vs. Workiva | INTERSHOP Communications vs. Fastly 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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