Correlation Between PSP Swiss and HIAG Immobilien
Can any of the company-specific risk be diversified away by investing in both PSP Swiss and HIAG Immobilien 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 PSP Swiss and HIAG Immobilien into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PSP Swiss Property and HIAG Immobilien Holding, you can compare the effects of market volatilities on PSP Swiss and HIAG Immobilien 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 PSP Swiss with a short position of HIAG Immobilien. Check out your portfolio center. Please also check ongoing floating volatility patterns of PSP Swiss and HIAG Immobilien.
Diversification Opportunities for PSP Swiss and HIAG Immobilien
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PSP and HIAG is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding PSP Swiss Property and HIAG Immobilien Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HIAG Immobilien Holding and PSP Swiss 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 PSP Swiss Property are associated (or correlated) with HIAG Immobilien. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HIAG Immobilien Holding has no effect on the direction of PSP Swiss i.e., PSP Swiss and HIAG Immobilien go up and down completely randomly.
Pair Corralation between PSP Swiss and HIAG Immobilien
Assuming the 90 days trading horizon PSP Swiss Property is expected to generate 1.22 times more return on investment than HIAG Immobilien. However, PSP Swiss is 1.22 times more volatile than HIAG Immobilien Holding. It trades about 0.06 of its potential returns per unit of risk. HIAG Immobilien Holding is currently generating about 0.04 per unit of risk. If you would invest 12,370 in PSP Swiss Property on August 29, 2024 and sell it today you would earn a total of 120.00 from holding PSP Swiss Property or generate 0.97% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.65% |
Values | Daily Returns |
PSP Swiss Property vs. HIAG Immobilien Holding
Performance |
Timeline |
PSP Swiss Property |
HIAG Immobilien Holding |
PSP Swiss and HIAG Immobilien Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PSP Swiss and HIAG Immobilien
The main advantage of trading using opposite PSP Swiss and HIAG Immobilien positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PSP Swiss position performs unexpectedly, HIAG Immobilien 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 HIAG Immobilien will offset losses from the drop in HIAG Immobilien's long position.PSP Swiss vs. Siegfried Holding | PSP Swiss vs. VAT Group AG | PSP Swiss vs. Lonza Group AG | PSP Swiss vs. Straumann Holding AG |
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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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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