Correlation Between Swiss Leader and VP Bank
Can any of the company-specific risk be diversified away by investing in both Swiss Leader and VP Bank 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 VP Bank 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 VP Bank AG, you can compare the effects of market volatilities on Swiss Leader and VP Bank 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 VP Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Leader and VP Bank.
Diversification Opportunities for Swiss Leader and VP Bank
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swiss and VPBN is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Leader Price and VP Bank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VP Bank AG 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 VP Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VP Bank AG has no effect on the direction of Swiss Leader i.e., Swiss Leader and VP Bank go up and down completely randomly.
Pair Corralation between Swiss Leader and VP Bank
Assuming the 90 days trading horizon Swiss Leader Price is expected to generate 0.56 times more return on investment than VP Bank. However, Swiss Leader Price is 1.79 times less risky than VP Bank. It trades about 0.04 of its potential returns per unit of risk. VP Bank AG is currently generating about -0.02 per unit of risk. If you would invest 176,850 in Swiss Leader Price on August 31, 2024 and sell it today you would earn a total of 16,905 from holding Swiss Leader Price or generate 9.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Swiss Leader Price vs. VP Bank AG
Performance |
| Timeline |
Swiss Leader and VP Bank Volatility Contrast
Predicted Return Density |
| Returns |
Swiss Leader Price
Pair trading matchups for Swiss Leader
VP Bank AG
Pair trading matchups for VP Bank
Pair Trading with Swiss Leader and VP Bank
The main advantage of trading using opposite Swiss Leader and VP Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Leader position performs unexpectedly, VP Bank 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 VP Bank will offset losses from the drop in VP Bank's long position.| Swiss Leader vs. Graubuendner Kantonalbank | Swiss Leader vs. Adval Tech Holding | Swiss Leader vs. Luzerner Kantonalbank AG | Swiss Leader vs. Zurich Insurance Group |
| VP Bank vs. Swissquote Group Holding | VP Bank vs. Banque Cantonale | VP Bank vs. Barry Callebaut AG | VP Bank vs. Vontobel Holding |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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