Correlation Between Mikron Holding and Klingelnberg
Can any of the company-specific risk be diversified away by investing in both Mikron Holding and Klingelnberg 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 Mikron Holding and Klingelnberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mikron Holding AG and Klingelnberg AG, you can compare the effects of market volatilities on Mikron Holding and Klingelnberg 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 Mikron Holding with a short position of Klingelnberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mikron Holding and Klingelnberg.
Diversification Opportunities for Mikron Holding and Klingelnberg
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mikron and Klingelnberg is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Mikron Holding AG and Klingelnberg AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klingelnberg AG and Mikron Holding 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 Mikron Holding AG are associated (or correlated) with Klingelnberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klingelnberg AG has no effect on the direction of Mikron Holding i.e., Mikron Holding and Klingelnberg go up and down completely randomly.
Pair Corralation between Mikron Holding and Klingelnberg
Assuming the 90 days trading horizon Mikron Holding AG is expected to generate 1.31 times more return on investment than Klingelnberg. However, Mikron Holding is 1.31 times more volatile than Klingelnberg AG. It trades about -0.02 of its potential returns per unit of risk. Klingelnberg AG is currently generating about -0.16 per unit of risk. If you would invest 1,430 in Mikron Holding AG on September 2, 2024 and sell it today you would lose (30.00) from holding Mikron Holding AG or give up 2.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mikron Holding AG vs. Klingelnberg AG
Performance |
| Timeline |
| Mikron Holding AG |
| Klingelnberg AG |
Mikron Holding and Klingelnberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mikron Holding and Klingelnberg
The main advantage of trading using opposite Mikron Holding and Klingelnberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mikron Holding position performs unexpectedly, Klingelnberg 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 Klingelnberg will offset losses from the drop in Klingelnberg's long position.| Mikron Holding vs. Rieter Holding AG | Mikron Holding vs. Feintool International Holding | Mikron Holding vs. Komax Holding AG | Mikron Holding vs. Bucher Industries AG |
| Klingelnberg vs. Mikron Holding AG | Klingelnberg vs. Implenia AG | Klingelnberg vs. mobilezone ag | Klingelnberg vs. Ascom Holding 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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