Correlation Between Metall Zug and Chocoladefabriken
Can any of the company-specific risk be diversified away by investing in both Metall Zug and Chocoladefabriken 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 Metall Zug and Chocoladefabriken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metall Zug AG and Chocoladefabriken Lindt Spruengli, you can compare the effects of market volatilities on Metall Zug and Chocoladefabriken 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 Metall Zug with a short position of Chocoladefabriken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metall Zug and Chocoladefabriken.
Diversification Opportunities for Metall Zug and Chocoladefabriken
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Metall and Chocoladefabriken is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Metall Zug AG and Chocoladefabriken Lindt Spruen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and Metall Zug 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 Metall Zug AG are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of Metall Zug i.e., Metall Zug and Chocoladefabriken go up and down completely randomly.
Pair Corralation between Metall Zug and Chocoladefabriken
Assuming the 90 days trading horizon Metall Zug AG is expected to under-perform the Chocoladefabriken. In addition to that, Metall Zug is 1.13 times more volatile than Chocoladefabriken Lindt Spruengli. It trades about -0.49 of its total potential returns per unit of risk. Chocoladefabriken Lindt Spruengli is currently generating about 0.17 per unit of volatility. If you would invest 9,820,000 in Chocoladefabriken Lindt Spruengli on October 23, 2024 and sell it today you would earn a total of 300,000 from holding Chocoladefabriken Lindt Spruengli or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metall Zug AG vs. Chocoladefabriken Lindt Spruen
Performance |
| Timeline |
| Metall Zug AG |
| Chocoladefabriken Lindt |
Metall Zug and Chocoladefabriken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metall Zug and Chocoladefabriken
The main advantage of trading using opposite Metall Zug and Chocoladefabriken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metall Zug position performs unexpectedly, Chocoladefabriken 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 Chocoladefabriken will offset losses from the drop in Chocoladefabriken's long position.| Metall Zug vs. Bucher Industries AG | Metall Zug vs. Burckhardt Compression | Metall Zug vs. Also Holding AG | Metall Zug vs. Emmi AG |
| Chocoladefabriken vs. Metall Zug AG | Chocoladefabriken vs. Schweiter Technologies AG | Chocoladefabriken vs. Zuger Kantonalbank | Chocoladefabriken vs. Cembra Money Bank |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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