Correlation Between RTW Venture and Jost Werke
Can any of the company-specific risk be diversified away by investing in both RTW Venture and Jost Werke 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 RTW Venture and Jost Werke into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RTW Venture Fund and Jost Werke AG, you can compare the effects of market volatilities on RTW Venture and Jost Werke 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 RTW Venture with a short position of Jost Werke. Check out your portfolio center. Please also check ongoing floating volatility patterns of RTW Venture and Jost Werke.
Diversification Opportunities for RTW Venture and Jost Werke
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between RTW and Jost is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding RTW Venture Fund and Jost Werke AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jost Werke AG and RTW Venture 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 RTW Venture Fund are associated (or correlated) with Jost Werke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jost Werke AG has no effect on the direction of RTW Venture i.e., RTW Venture and Jost Werke go up and down completely randomly.
Pair Corralation between RTW Venture and Jost Werke
Assuming the 90 days trading horizon RTW Venture Fund is expected to generate 0.98 times more return on investment than Jost Werke. However, RTW Venture Fund is 1.02 times less risky than Jost Werke. It trades about 0.06 of its potential returns per unit of risk. Jost Werke AG is currently generating about 0.01 per unit of risk. If you would invest 122.00 in RTW Venture Fund on September 4, 2024 and sell it today you would earn a total of 29.00 from holding RTW Venture Fund or generate 23.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.8% |
| Values | Daily Returns |
RTW Venture Fund vs. Jost Werke AG
Performance |
| Timeline |
| RTW Venture Fund |
| Jost Werke AG |
RTW Venture and Jost Werke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RTW Venture and Jost Werke
The main advantage of trading using opposite RTW Venture and Jost Werke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RTW Venture position performs unexpectedly, Jost Werke 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 Jost Werke will offset losses from the drop in Jost Werke's long position.| RTW Venture vs. Naked Wines plc | RTW Venture vs. LPKF Laser Electronics | RTW Venture vs. British American Tobacco | RTW Venture vs. BW Offshore |
| Jost Werke vs. Catalyst Media Group | Jost Werke vs. CATLIN GROUP | Jost Werke vs. RTW Venture Fund | Jost Werke vs. Secure Property Development |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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