Correlation Between Schweizer Electronic and 11880 Solutions
Can any of the company-specific risk be diversified away by investing in both Schweizer Electronic and 11880 Solutions 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 Schweizer Electronic and 11880 Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweizer Electronic AG and 11880 Solutions AG, you can compare the effects of market volatilities on Schweizer Electronic and 11880 Solutions 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 Schweizer Electronic with a short position of 11880 Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweizer Electronic and 11880 Solutions.
Diversification Opportunities for Schweizer Electronic and 11880 Solutions
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Schweizer and 11880 is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Schweizer Electronic AG and 11880 Solutions AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 11880 Solutions AG and Schweizer Electronic 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 Schweizer Electronic AG are associated (or correlated) with 11880 Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 11880 Solutions AG has no effect on the direction of Schweizer Electronic i.e., Schweizer Electronic and 11880 Solutions go up and down completely randomly.
Pair Corralation between Schweizer Electronic and 11880 Solutions
Assuming the 90 days horizon Schweizer Electronic AG is expected to under-perform the 11880 Solutions. In addition to that, Schweizer Electronic is 2.22 times more volatile than 11880 Solutions AG. It trades about -0.16 of its total potential returns per unit of risk. 11880 Solutions AG is currently generating about -0.09 per unit of volatility. If you would invest 80.00 in 11880 Solutions AG on September 14, 2024 and sell it today you would lose (4.00) from holding 11880 Solutions AG or give up 5.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schweizer Electronic AG vs. 11880 Solutions AG
Performance |
| Timeline |
| Schweizer Electronic |
| 11880 Solutions AG |
Schweizer Electronic and 11880 Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schweizer Electronic and 11880 Solutions
The main advantage of trading using opposite Schweizer Electronic and 11880 Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweizer Electronic position performs unexpectedly, 11880 Solutions 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 11880 Solutions will offset losses from the drop in 11880 Solutions' long position.| Schweizer Electronic vs. Benchmark Electronics | Schweizer Electronic vs. Superior Plus Corp | Schweizer Electronic vs. SIVERS SEMICONDUCTORS AB | Schweizer Electronic vs. Norsk Hydro ASA |
| 11880 Solutions vs. Schweizer Electronic AG | 11880 Solutions vs. Renesas Electronics | 11880 Solutions vs. Tencent Music Entertainment | 11880 Solutions vs. CNVISION MEDIA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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