Correlation Between Swiss Steel and Basellandschaftliche
Can any of the company-specific risk be diversified away by investing in both Swiss Steel and Basellandschaftliche 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 Steel and Basellandschaftliche into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Steel Holding and Basellandschaftliche Kantonalbank, you can compare the effects of market volatilities on Swiss Steel and Basellandschaftliche 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 Steel with a short position of Basellandschaftliche. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Steel and Basellandschaftliche.
Diversification Opportunities for Swiss Steel and Basellandschaftliche
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Swiss and Basellandschaftliche is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Steel Holding and Basellandschaftliche Kantonalb in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basellandschaftliche and Swiss Steel 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 Steel Holding are associated (or correlated) with Basellandschaftliche. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basellandschaftliche has no effect on the direction of Swiss Steel i.e., Swiss Steel and Basellandschaftliche go up and down completely randomly.
Pair Corralation between Swiss Steel and Basellandschaftliche
Assuming the 90 days trading horizon Swiss Steel Holding is expected to under-perform the Basellandschaftliche. In addition to that, Swiss Steel is 10.09 times more volatile than Basellandschaftliche Kantonalbank. It trades about -0.38 of its total potential returns per unit of risk. Basellandschaftliche Kantonalbank is currently generating about 0.0 per unit of volatility. If you would invest 84,800 in Basellandschaftliche Kantonalbank on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Basellandschaftliche Kantonalbank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swiss Steel Holding vs. Basellandschaftliche Kantonalb
Performance |
| Timeline |
| Swiss Steel Holding |
| Basellandschaftliche |
Swiss Steel and Basellandschaftliche Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swiss Steel and Basellandschaftliche
The main advantage of trading using opposite Swiss Steel and Basellandschaftliche positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Steel position performs unexpectedly, Basellandschaftliche 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 Basellandschaftliche will offset losses from the drop in Basellandschaftliche's long position.| Swiss Steel vs. OC Oerlikon Corp | Swiss Steel vs. Meyer Burger Tech | Swiss Steel vs. Evolva Holding SA | Swiss Steel vs. Sulzer AG |
| Basellandschaftliche vs. Basler Kantonalbank | Basellandschaftliche vs. Berner Kantonalbank AG | Basellandschaftliche vs. Luzerner Kantonalbank AG | Basellandschaftliche vs. Banque Cantonale |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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