Correlation Between Swiss Leader and PolyPeptide Group
Can any of the company-specific risk be diversified away by investing in both Swiss Leader and PolyPeptide Group 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 Leader and PolyPeptide Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Leader Price and PolyPeptide Group AG, you can compare the effects of market volatilities on Swiss Leader and PolyPeptide Group 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 Leader with a short position of PolyPeptide Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Leader and PolyPeptide Group.
Diversification Opportunities for Swiss Leader and PolyPeptide Group
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Swiss and PolyPeptide is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Leader Price and PolyPeptide Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PolyPeptide Group and Swiss Leader 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 Leader Price are associated (or correlated) with PolyPeptide Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PolyPeptide Group has no effect on the direction of Swiss Leader i.e., Swiss Leader and PolyPeptide Group go up and down completely randomly.
Pair Corralation between Swiss Leader and PolyPeptide Group
Assuming the 90 days trading horizon Swiss Leader Price is expected to generate 0.29 times more return on investment than PolyPeptide Group. However, Swiss Leader Price is 3.5 times less risky than PolyPeptide Group. It trades about 0.02 of its potential returns per unit of risk. PolyPeptide Group AG is currently generating about -0.24 per unit of risk. If you would invest 194,439 in Swiss Leader Price on September 4, 2024 and sell it today you would earn a total of 602.00 from holding Swiss Leader Price or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swiss Leader Price vs. PolyPeptide Group AG
Performance |
| Timeline |
Swiss Leader and PolyPeptide Group Volatility Contrast
Predicted Return Density |
| Returns |
Swiss Leader Price
Pair trading matchups for Swiss Leader
PolyPeptide Group AG
Pair trading matchups for PolyPeptide Group
Pair Trading with Swiss Leader and PolyPeptide Group
The main advantage of trading using opposite Swiss Leader and PolyPeptide Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Leader position performs unexpectedly, PolyPeptide Group 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 PolyPeptide Group will offset losses from the drop in PolyPeptide Group's long position.| Swiss Leader vs. St Galler Kantonalbank | Swiss Leader vs. Glarner Kantonalbank | Swiss Leader vs. Schweiter Technologies AG | Swiss Leader vs. Metall Zug AG |
| PolyPeptide Group vs. Bachem Holding AG | PolyPeptide Group vs. Siegfried Holding | PolyPeptide Group vs. VAT Group AG | PolyPeptide Group vs. Comet 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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