Correlation Between Siemens AG and Weichai Power
Can any of the company-specific risk be diversified away by investing in both Siemens AG and Weichai Power 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 AG and Weichai Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siemens AG ADR and Weichai Power, you can compare the effects of market volatilities on Siemens AG and Weichai Power 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 AG with a short position of Weichai Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siemens AG and Weichai Power.
Diversification Opportunities for Siemens AG and Weichai Power
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siemens and Weichai is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Siemens AG ADR and Weichai Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Power and Siemens AG 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 AG ADR are associated (or correlated) with Weichai Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Power has no effect on the direction of Siemens AG i.e., Siemens AG and Weichai Power go up and down completely randomly.
Pair Corralation between Siemens AG and Weichai Power
If you would invest 1,126 in Weichai Power on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Weichai Power or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siemens AG ADR vs. Weichai Power
Performance |
| Timeline |
| Siemens AG ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Weichai Power |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Siemens AG and Weichai Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siemens AG and Weichai Power
The main advantage of trading using opposite Siemens AG and Weichai Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siemens AG position performs unexpectedly, Weichai Power 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 Weichai Power will offset losses from the drop in Weichai Power's long position.| Siemens AG vs. Sandvik AB | Siemens AG vs. Schneider Electric SA | Siemens AG vs. KONE Oyj | Siemens AG vs. Atlas Copco AB |
| Weichai Power vs. Shanghai Electric Group | Weichai Power vs. Xinjiang Goldwind Science | Weichai Power vs. Nordson | Weichai Power vs. CVD Equipment |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |