Correlation Between Metall Zug and Swiss Leader
Can any of the company-specific risk be diversified away by investing in both Metall Zug and Swiss Leader 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 Swiss Leader 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 Swiss Leader Price, you can compare the effects of market volatilities on Metall Zug and Swiss Leader 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 Swiss Leader. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metall Zug and Swiss Leader.
Diversification Opportunities for Metall Zug and Swiss Leader
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Metall and Swiss is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Metall Zug AG and Swiss Leader Price in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiss Leader Price 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 Swiss Leader. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiss Leader Price has no effect on the direction of Metall Zug i.e., Metall Zug and Swiss Leader go up and down completely randomly.
Pair Corralation between Metall Zug and Swiss Leader
Assuming the 90 days trading horizon Metall Zug AG is expected to under-perform the Swiss Leader. In addition to that, Metall Zug is 2.91 times more volatile than Swiss Leader Price. It trades about -0.1 of its total potential returns per unit of risk. Swiss Leader Price is currently generating about 0.28 per unit of volatility. If you would invest 194,976 in Swiss Leader Price on November 2, 2024 and sell it today you would earn a total of 13,405 from holding Swiss Leader Price or generate 6.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metall Zug AG vs. Swiss Leader Price
Performance |
| Timeline |
Metall Zug and Swiss Leader Volatility Contrast
Predicted Return Density |
| Returns |
Metall Zug AG
Pair trading matchups for Metall Zug
Swiss Leader Price
Pair trading matchups for Swiss Leader
Pair Trading with Metall Zug and Swiss Leader
The main advantage of trading using opposite Metall Zug and Swiss Leader positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metall Zug position performs unexpectedly, Swiss Leader 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 Swiss Leader will offset losses from the drop in Swiss Leader'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 |
| Swiss Leader vs. Glarner Kantonalbank | Swiss Leader vs. HBM Healthcare Investments | Swiss Leader vs. Basellandschaftliche Kantonalbank | Swiss Leader vs. Luzerner Kantonalbank 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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