Correlation Between OC Oerlikon and Schweiter Technologies
Can any of the company-specific risk be diversified away by investing in both OC Oerlikon and Schweiter Technologies 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 OC Oerlikon and Schweiter Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OC Oerlikon Corp and Schweiter Technologies AG, you can compare the effects of market volatilities on OC Oerlikon and Schweiter Technologies 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 OC Oerlikon with a short position of Schweiter Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of OC Oerlikon and Schweiter Technologies.
Diversification Opportunities for OC Oerlikon and Schweiter Technologies
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between OERL and Schweiter is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding OC Oerlikon Corp and Schweiter Technologies AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schweiter Technologies and OC Oerlikon 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 OC Oerlikon Corp are associated (or correlated) with Schweiter Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schweiter Technologies has no effect on the direction of OC Oerlikon i.e., OC Oerlikon and Schweiter Technologies go up and down completely randomly.
Pair Corralation between OC Oerlikon and Schweiter Technologies
Assuming the 90 days trading horizon OC Oerlikon is expected to generate 2.5 times less return on investment than Schweiter Technologies. But when comparing it to its historical volatility, OC Oerlikon Corp is 1.51 times less risky than Schweiter Technologies. It trades about 0.12 of its potential returns per unit of risk. Schweiter Technologies AG is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 41,600 in Schweiter Technologies AG on November 3, 2024 and sell it today you would earn a total of 3,950 from holding Schweiter Technologies AG or generate 9.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OC Oerlikon Corp vs. Schweiter Technologies AG
Performance |
| Timeline |
| OC Oerlikon Corp |
| Schweiter Technologies |
OC Oerlikon and Schweiter Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OC Oerlikon and Schweiter Technologies
The main advantage of trading using opposite OC Oerlikon and Schweiter Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OC Oerlikon position performs unexpectedly, Schweiter Technologies 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 Schweiter Technologies will offset losses from the drop in Schweiter Technologies' long position.| OC Oerlikon vs. Sulzer AG | OC Oerlikon vs. Helvetia Holding AG | OC Oerlikon vs. Swiss Life Holding | OC Oerlikon vs. Adecco Group AG |
| Schweiter Technologies vs. Inficon Holding | Schweiter Technologies vs. Bucher Industries AG | Schweiter Technologies vs. Sulzer AG | Schweiter Technologies vs. Interroll 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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