Correlation Between Swiss Life and Feintool International
Can any of the company-specific risk be diversified away by investing in both Swiss Life and Feintool International 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 Swiss Life and Feintool International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Life Holding and Feintool International Holding, you can compare the effects of market volatilities on Swiss Life and Feintool International 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 Swiss Life with a short position of Feintool International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Life and Feintool International.
Diversification Opportunities for Swiss Life and Feintool International
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swiss and Feintool is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Life Holding and Feintool International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Feintool International and Swiss Life 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 Swiss Life Holding are associated (or correlated) with Feintool International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Feintool International has no effect on the direction of Swiss Life i.e., Swiss Life and Feintool International go up and down completely randomly.
Pair Corralation between Swiss Life and Feintool International
Assuming the 90 days trading horizon Swiss Life Holding is expected to generate 0.53 times more return on investment than Feintool International. However, Swiss Life Holding is 1.9 times less risky than Feintool International. It trades about 0.12 of its potential returns per unit of risk. Feintool International Holding is currently generating about -0.04 per unit of risk. If you would invest 63,380 in Swiss Life Holding on September 3, 2024 and sell it today you would earn a total of 8,800 from holding Swiss Life Holding or generate 13.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swiss Life Holding vs. Feintool International Holding
Performance |
| Timeline |
| Swiss Life Holding |
| Feintool International |
Swiss Life and Feintool International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swiss Life and Feintool International
The main advantage of trading using opposite Swiss Life and Feintool International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Life position performs unexpectedly, Feintool International 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 Feintool International will offset losses from the drop in Feintool International's long position.| Swiss Life vs. Zurich Insurance Group | Swiss Life vs. Swiss Re AG | Swiss Life vs. Swisscom AG | Swiss Life vs. Lonza Group AG |
| Feintool International vs. Rieter Holding AG | Feintool International vs. Autoneum Holding AG | Feintool International vs. Bucher Industries AG | Feintool International vs. Komax Holding AG |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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