Correlation Between Straumann Holding and Sonova H
Can any of the company-specific risk be diversified away by investing in both Straumann Holding and Sonova H 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 Straumann Holding and Sonova H into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Straumann Holding AG and Sonova H Ag, you can compare the effects of market volatilities on Straumann Holding and Sonova H 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 Straumann Holding with a short position of Sonova H. Check out your portfolio center. Please also check ongoing floating volatility patterns of Straumann Holding and Sonova H.
Diversification Opportunities for Straumann Holding and Sonova H
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Straumann and Sonova is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Straumann Holding AG and Sonova H Ag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonova H Ag and Straumann Holding 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 Straumann Holding AG are associated (or correlated) with Sonova H. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonova H Ag has no effect on the direction of Straumann Holding i.e., Straumann Holding and Sonova H go up and down completely randomly.
Pair Corralation between Straumann Holding and Sonova H
Assuming the 90 days trading horizon Straumann Holding is expected to generate 3.27 times less return on investment than Sonova H. In addition to that, Straumann Holding is 1.31 times more volatile than Sonova H Ag. It trades about 0.02 of its total potential returns per unit of risk. Sonova H Ag is currently generating about 0.1 per unit of volatility. If you would invest 20,575 in Sonova H Ag on August 25, 2024 and sell it today you would earn a total of 10,635 from holding Sonova H Ag or generate 51.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Straumann Holding AG vs. Sonova H Ag
Performance |
| Timeline |
| Straumann Holding |
| Sonova H Ag |
Straumann Holding and Sonova H Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Straumann Holding and Sonova H
The main advantage of trading using opposite Straumann Holding and Sonova H positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Straumann Holding position performs unexpectedly, Sonova H 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 Sonova H will offset losses from the drop in Sonova H's long position.| Straumann Holding vs. Sonova H Ag | Straumann Holding vs. Sika AG | Straumann Holding vs. Lonza Group AG | Straumann Holding vs. Givaudan SA |
| Sonova H vs. Straumann Holding AG | Sonova H vs. Geberit AG | Sonova H vs. Sika AG | Sonova H vs. Givaudan SA |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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