Correlation Between Palfinger and EVN AG
Can any of the company-specific risk be diversified away by investing in both Palfinger and EVN AG 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 Palfinger and EVN AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Palfinger AG and EVN AG, you can compare the effects of market volatilities on Palfinger and EVN AG 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 Palfinger with a short position of EVN AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palfinger and EVN AG.
Diversification Opportunities for Palfinger and EVN AG
Very good diversification
The 3 months correlation between Palfinger and EVN is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Palfinger AG and EVN AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVN AG and Palfinger 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 Palfinger AG are associated (or correlated) with EVN AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVN AG has no effect on the direction of Palfinger i.e., Palfinger and EVN AG go up and down completely randomly.
Pair Corralation between Palfinger and EVN AG
Assuming the 90 days trading horizon Palfinger AG is expected to under-perform the EVN AG. In addition to that, Palfinger is 1.41 times more volatile than EVN AG. It trades about -0.01 of its total potential returns per unit of risk. EVN AG is currently generating about 0.01 per unit of volatility. If you would invest 2,185 in EVN AG on January 17, 2025 and sell it today you would earn a total of 0.00 from holding EVN AG or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Palfinger AG vs. EVN AG
Performance |
| Timeline |
| Palfinger AG |
| EVN AG |
Palfinger and EVN AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Palfinger and EVN AG
The main advantage of trading using opposite Palfinger and EVN AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Palfinger position performs unexpectedly, EVN AG 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 EVN AG will offset losses from the drop in EVN AG's long position.| Palfinger vs. Vienna Insurance Group | Palfinger vs. Oberbank AG | Palfinger vs. AMAG Austria Metall | Palfinger vs. Wiener Privatbank SE |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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