Correlation Between Siemens Healthineers and Stryker
Can any of the company-specific risk be diversified away by investing in both Siemens Healthineers and Stryker 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 Siemens Healthineers and Stryker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siemens Healthineers AG and Stryker, you can compare the effects of market volatilities on Siemens Healthineers and Stryker 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 Siemens Healthineers with a short position of Stryker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siemens Healthineers and Stryker.
Diversification Opportunities for Siemens Healthineers and Stryker
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Siemens and Stryker is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Siemens Healthineers AG and Stryker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stryker and Siemens Healthineers 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 Siemens Healthineers AG are associated (or correlated) with Stryker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stryker has no effect on the direction of Siemens Healthineers i.e., Siemens Healthineers and Stryker go up and down completely randomly.
Pair Corralation between Siemens Healthineers and Stryker
Assuming the 90 days horizon Siemens Healthineers AG is expected to generate 1.61 times more return on investment than Stryker. However, Siemens Healthineers is 1.61 times more volatile than Stryker. It trades about 0.05 of its potential returns per unit of risk. Stryker is currently generating about -0.14 per unit of risk. If you would invest 5,513 in Siemens Healthineers AG on September 13, 2024 and sell it today you would earn a total of 87.00 from holding Siemens Healthineers AG or generate 1.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siemens Healthineers AG vs. Stryker
Performance |
| Timeline |
| Siemens Healthineers |
| Stryker |
Siemens Healthineers and Stryker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siemens Healthineers and Stryker
The main advantage of trading using opposite Siemens Healthineers and Stryker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siemens Healthineers position performs unexpectedly, Stryker 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 Stryker will offset losses from the drop in Stryker's long position.| Siemens Healthineers vs. Artivion | Siemens Healthineers vs. Anika Therapeutics | Siemens Healthineers vs. Sight Sciences | Siemens Healthineers vs. Orthofix Medical |
| Stryker vs. Boston Scientific Corp | Stryker vs. Abbott Laboratories | Stryker vs. Medtronic PLC | Stryker vs. DexCom Inc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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