Correlation Between Swissquote Group and Schweizerische Nationalbank
Can any of the company-specific risk be diversified away by investing in both Swissquote Group and Schweizerische Nationalbank 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 Swissquote Group and Schweizerische Nationalbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swissquote Group Holding and Schweizerische Nationalbank, you can compare the effects of market volatilities on Swissquote Group and Schweizerische Nationalbank 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 Swissquote Group with a short position of Schweizerische Nationalbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swissquote Group and Schweizerische Nationalbank.
Diversification Opportunities for Swissquote Group and Schweizerische Nationalbank
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swissquote and Schweizerische is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Swissquote Group Holding and Schweizerische Nationalbank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schweizerische Nationalbank and Swissquote Group 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 Swissquote Group Holding are associated (or correlated) with Schweizerische Nationalbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schweizerische Nationalbank has no effect on the direction of Swissquote Group i.e., Swissquote Group and Schweizerische Nationalbank go up and down completely randomly.
Pair Corralation between Swissquote Group and Schweizerische Nationalbank
Assuming the 90 days trading horizon Swissquote Group Holding is expected to generate 0.81 times more return on investment than Schweizerische Nationalbank. However, Swissquote Group Holding is 1.24 times less risky than Schweizerische Nationalbank. It trades about 0.29 of its potential returns per unit of risk. Schweizerische Nationalbank is currently generating about 0.11 per unit of risk. If you would invest 33,500 in Swissquote Group Holding on October 25, 2024 and sell it today you would earn a total of 5,740 from holding Swissquote Group Holding or generate 17.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swissquote Group Holding vs. Schweizerische Nationalbank
Performance |
| Timeline |
| Swissquote Group Holding |
| Schweizerische Nationalbank |
Swissquote Group and Schweizerische Nationalbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swissquote Group and Schweizerische Nationalbank
The main advantage of trading using opposite Swissquote Group and Schweizerische Nationalbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swissquote Group position performs unexpectedly, Schweizerische Nationalbank 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 Schweizerische Nationalbank will offset losses from the drop in Schweizerische Nationalbank's long position.| Swissquote Group vs. Logitech International SA | Swissquote Group vs. Swiss Life Holding | Swissquote Group vs. VAT Group AG | Swissquote Group vs. Partners Group 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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