Correlation Between SARTORIUS and Becton Dickinson
Can any of the company-specific risk be diversified away by investing in both SARTORIUS and Becton Dickinson 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 SARTORIUS and Becton Dickinson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SARTORIUS AG UNSPADR and Becton Dickinson and, you can compare the effects of market volatilities on SARTORIUS and Becton Dickinson 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 SARTORIUS with a short position of Becton Dickinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of SARTORIUS and Becton Dickinson.
Diversification Opportunities for SARTORIUS and Becton Dickinson
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SARTORIUS and Becton is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding SARTORIUS AG UNSPADR and Becton Dickinson and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Becton Dickinson and SARTORIUS 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 SARTORIUS AG UNSPADR are associated (or correlated) with Becton Dickinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Becton Dickinson has no effect on the direction of SARTORIUS i.e., SARTORIUS and Becton Dickinson go up and down completely randomly.
Pair Corralation between SARTORIUS and Becton Dickinson
Assuming the 90 days trading horizon SARTORIUS AG UNSPADR is expected to generate 1.27 times more return on investment than Becton Dickinson. However, SARTORIUS is 1.27 times more volatile than Becton Dickinson and. It trades about 0.0 of its potential returns per unit of risk. Becton Dickinson and is currently generating about -0.02 per unit of risk. If you would invest 3,520 in SARTORIUS AG UNSPADR on September 1, 2024 and sell it today you would lose (40.00) from holding SARTORIUS AG UNSPADR or give up 1.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SARTORIUS AG UNSPADR vs. Becton Dickinson and
Performance |
| Timeline |
| SARTORIUS AG UNSPADR |
| Becton Dickinson |
SARTORIUS and Becton Dickinson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SARTORIUS and Becton Dickinson
The main advantage of trading using opposite SARTORIUS and Becton Dickinson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SARTORIUS position performs unexpectedly, Becton Dickinson 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 Becton Dickinson will offset losses from the drop in Becton Dickinson's long position.| SARTORIUS vs. ESSILORLUXOTTICA 12ON | SARTORIUS vs. Intuitive Surgical | SARTORIUS vs. EssilorLuxottica Socit anonyme | SARTORIUS vs. HOYA Corporation |
| Becton Dickinson vs. ESSILORLUXOTTICA 12ON | Becton Dickinson vs. Intuitive Surgical | Becton Dickinson vs. EssilorLuxottica Socit anonyme | Becton Dickinson vs. HOYA Corporation |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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