Correlation Between Roche Holding and Cicor Technologies
Can any of the company-specific risk be diversified away by investing in both Roche Holding and Cicor 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 Roche Holding and Cicor Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roche Holding AG and Cicor Technologies, you can compare the effects of market volatilities on Roche Holding and Cicor 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 Roche Holding with a short position of Cicor Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roche Holding and Cicor Technologies.
Diversification Opportunities for Roche Holding and Cicor Technologies
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Roche and Cicor is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Roche Holding AG and Cicor Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cicor Technologies and Roche 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 Roche Holding AG are associated (or correlated) with Cicor Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cicor Technologies has no effect on the direction of Roche Holding i.e., Roche Holding and Cicor Technologies go up and down completely randomly.
Pair Corralation between Roche Holding and Cicor Technologies
Assuming the 90 days horizon Roche Holding AG is expected to under-perform the Cicor Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Roche Holding AG is 1.42 times less risky than Cicor Technologies. The stock trades about -0.26 of its potential returns per unit of risk. The Cicor Technologies is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 5,240 in Cicor Technologies on September 1, 2024 and sell it today you would earn a total of 660.00 from holding Cicor Technologies or generate 12.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Roche Holding AG vs. Cicor Technologies
Performance |
| Timeline |
| Roche Holding AG |
| Cicor Technologies |
Roche Holding and Cicor Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roche Holding and Cicor Technologies
The main advantage of trading using opposite Roche Holding and Cicor Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roche Holding position performs unexpectedly, Cicor 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 Cicor Technologies will offset losses from the drop in Cicor Technologies' long position.| Roche Holding vs. Roche Holding AG | Roche Holding vs. Nestl SA | Roche Holding vs. Zurich Insurance Group | Roche Holding vs. Swiss Re AG |
| Cicor Technologies vs. Jungfraubahn Holding AG | Cicor Technologies vs. Amsterdam Commodities NV | Cicor Technologies vs. Flow Traders BV | Cicor Technologies vs. ForFarmers NV |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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