Correlation Between ETFS Coffee and Tradegate
Can any of the company-specific risk be diversified away by investing in both ETFS Coffee and Tradegate 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 ETFS Coffee and Tradegate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETFS Coffee ETC and Tradegate AG Wertpapierhandelsbank, you can compare the effects of market volatilities on ETFS Coffee and Tradegate 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 ETFS Coffee with a short position of Tradegate. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETFS Coffee and Tradegate.
Diversification Opportunities for ETFS Coffee and Tradegate
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between ETFS and Tradegate is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding ETFS Coffee ETC and Tradegate AG Wertpapierhandels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tradegate AG Wertpap and ETFS Coffee 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 ETFS Coffee ETC are associated (or correlated) with Tradegate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tradegate AG Wertpap has no effect on the direction of ETFS Coffee i.e., ETFS Coffee and Tradegate go up and down completely randomly.
Pair Corralation between ETFS Coffee and Tradegate
Assuming the 90 days trading horizon ETFS Coffee ETC is expected to generate 39.59 times more return on investment than Tradegate. However, ETFS Coffee is 39.59 times more volatile than Tradegate AG Wertpapierhandelsbank. It trades about 0.05 of its potential returns per unit of risk. Tradegate AG Wertpapierhandelsbank is currently generating about -0.03 per unit of risk. If you would invest 100.00 in ETFS Coffee ETC on September 13, 2024 and sell it today you would earn a total of 5,442 from holding ETFS Coffee ETC or generate 5442.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.61% |
| Values | Daily Returns |
ETFS Coffee ETC vs. Tradegate AG Wertpapierhandels
Performance |
| Timeline |
| ETFS Coffee ETC |
| Tradegate AG Wertpap |
ETFS Coffee and Tradegate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETFS Coffee and Tradegate
The main advantage of trading using opposite ETFS Coffee and Tradegate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETFS Coffee position performs unexpectedly, Tradegate 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 Tradegate will offset losses from the drop in Tradegate's long position.| ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc | ETFS Coffee vs. Apple Inc |
| Tradegate vs. Superior Plus Corp | Tradegate vs. SIVERS SEMICONDUCTORS AB | Tradegate vs. CHINA HUARONG ENERHD 50 | Tradegate vs. NORDIC HALIBUT AS |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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