Correlation Between SwissCom and New World
Can any of the company-specific risk be diversified away by investing in both SwissCom and New World 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 SwissCom and New World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SwissCom AG and New World Development, you can compare the effects of market volatilities on SwissCom and New World 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 SwissCom with a short position of New World. Check out your portfolio center. Please also check ongoing floating volatility patterns of SwissCom and New World.
Diversification Opportunities for SwissCom and New World
Very weak diversification
The 3 months correlation between SwissCom and New is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding SwissCom AG and New World Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New World Development and SwissCom 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 SwissCom AG are associated (or correlated) with New World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New World Development has no effect on the direction of SwissCom i.e., SwissCom and New World go up and down completely randomly.
Pair Corralation between SwissCom and New World
Assuming the 90 days horizon SwissCom AG is expected to generate 0.15 times more return on investment than New World. However, SwissCom AG is 6.73 times less risky than New World. It trades about 0.01 of its potential returns per unit of risk. New World Development is currently generating about -0.01 per unit of risk. If you would invest 5,768 in SwissCom AG on September 12, 2024 and sell it today you would earn a total of 12.00 from holding SwissCom AG or generate 0.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.18% |
| Values | Daily Returns |
SwissCom AG vs. New World Development
Performance |
| Timeline |
| SwissCom AG |
| New World Development |
SwissCom and New World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SwissCom and New World
The main advantage of trading using opposite SwissCom and New World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SwissCom position performs unexpectedly, New World 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 New World will offset losses from the drop in New World's long position.| SwissCom vs. Telecom Argentina SA | SwissCom vs. Rogers Communications | SwissCom vs. Magyar Telekom Plc | SwissCom vs. Hellenic Telecommunications Org |
| New World vs. St Joe Company | New World vs. Secom Co Ltd | New World vs. Daiwa House Industry | New World vs. MSAD Insurance Group |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |