Correlation Between Schweiter Technologies and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Schweiter Technologies and NYSE Composite 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 Schweiter Technologies and NYSE Composite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweiter Technologies AG and NYSE Composite, you can compare the effects of market volatilities on Schweiter Technologies and NYSE Composite 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 Schweiter Technologies with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweiter Technologies and NYSE Composite.
Diversification Opportunities for Schweiter Technologies and NYSE Composite
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Schweiter and NYSE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Schweiter Technologies AG and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Schweiter Technologies 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 Schweiter Technologies AG are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Schweiter Technologies i.e., Schweiter Technologies and NYSE Composite go up and down completely randomly.
Pair Corralation between Schweiter Technologies and NYSE Composite
Assuming the 90 days horizon Schweiter Technologies AG is expected to under-perform the NYSE Composite. In addition to that, Schweiter Technologies is 1.02 times more volatile than NYSE Composite. It trades about -0.04 of its total potential returns per unit of risk. NYSE Composite is currently generating about 0.07 per unit of volatility. If you would invest 1,605,225 in NYSE Composite on November 2, 2024 and sell it today you would earn a total of 411,397 from holding NYSE Composite or generate 25.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 77.53% |
| Values | Daily Returns |
Schweiter Technologies AG vs. NYSE Composite
Performance |
| Timeline |
Schweiter Technologies and NYSE Composite Volatility Contrast
Predicted Return Density |
| Returns |
Schweiter Technologies AG
Pair trading matchups for Schweiter Technologies
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Schweiter Technologies and NYSE Composite
The main advantage of trading using opposite Schweiter Technologies and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweiter Technologies position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.| Schweiter Technologies vs. Trane Technologies plc | Schweiter Technologies vs. Masco | Schweiter Technologies vs. Quanex Building Products | Schweiter Technologies vs. Jeld Wen Holding |
| NYSE Composite vs. Palomar Holdings | NYSE Composite vs. The Peoples Insurance | NYSE Composite vs. Radian Group | NYSE Composite vs. Nascent Wine |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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