Correlation Between Schneider Electric and FANUC PUNSPADR
Can any of the company-specific risk be diversified away by investing in both Schneider Electric and FANUC PUNSPADR 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 Schneider Electric and FANUC PUNSPADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schneider Electric SE and FANUC PUNSPADR 110, you can compare the effects of market volatilities on Schneider Electric and FANUC PUNSPADR 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 Schneider Electric with a short position of FANUC PUNSPADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schneider Electric and FANUC PUNSPADR.
Diversification Opportunities for Schneider Electric and FANUC PUNSPADR
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Schneider and FANUC is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Schneider Electric SE and FANUC PUNSPADR 110 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FANUC PUNSPADR 110 and Schneider Electric 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 Schneider Electric SE are associated (or correlated) with FANUC PUNSPADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FANUC PUNSPADR 110 has no effect on the direction of Schneider Electric i.e., Schneider Electric and FANUC PUNSPADR go up and down completely randomly.
Pair Corralation between Schneider Electric and FANUC PUNSPADR
Assuming the 90 days trading horizon Schneider Electric SE is expected to generate 0.63 times more return on investment than FANUC PUNSPADR. However, Schneider Electric SE is 1.59 times less risky than FANUC PUNSPADR. It trades about 0.06 of its potential returns per unit of risk. FANUC PUNSPADR 110 is currently generating about 0.02 per unit of risk. If you would invest 22,320 in Schneider Electric SE on September 13, 2024 and sell it today you would earn a total of 2,445 from holding Schneider Electric SE or generate 10.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schneider Electric SE vs. FANUC PUNSPADR 110
Performance |
| Timeline |
| Schneider Electric |
| FANUC PUNSPADR 110 |
Schneider Electric and FANUC PUNSPADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schneider Electric and FANUC PUNSPADR
The main advantage of trading using opposite Schneider Electric and FANUC PUNSPADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schneider Electric position performs unexpectedly, FANUC PUNSPADR 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 FANUC PUNSPADR will offset losses from the drop in FANUC PUNSPADR's long position.| Schneider Electric vs. Siemens Aktiengesellschaft | Schneider Electric vs. Siemens Aktiengesellschaft | Schneider Electric vs. Atlas Copco A | Schneider Electric vs. RATIONAL Aktiengesellschaft |
| FANUC PUNSPADR vs. Siemens Aktiengesellschaft | FANUC PUNSPADR vs. Siemens Aktiengesellschaft | FANUC PUNSPADR vs. Schneider Electric SE | FANUC PUNSPADR vs. Atlas Copco A |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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