Correlation Between Schlatter Industries and Emmi AG
Can any of the company-specific risk be diversified away by investing in both Schlatter Industries and Emmi AG 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 Schlatter Industries and Emmi AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schlatter Industries AG and Emmi AG, you can compare the effects of market volatilities on Schlatter Industries and Emmi AG 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 Schlatter Industries with a short position of Emmi AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schlatter Industries and Emmi AG.
Diversification Opportunities for Schlatter Industries and Emmi AG
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Schlatter and Emmi is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Schlatter Industries AG and Emmi AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emmi AG and Schlatter Industries 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 Schlatter Industries AG are associated (or correlated) with Emmi AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emmi AG has no effect on the direction of Schlatter Industries i.e., Schlatter Industries and Emmi AG go up and down completely randomly.
Pair Corralation between Schlatter Industries and Emmi AG
Assuming the 90 days trading horizon Schlatter Industries AG is expected to generate 2.18 times more return on investment than Emmi AG. However, Schlatter Industries is 2.18 times more volatile than Emmi AG. It trades about 0.05 of its potential returns per unit of risk. Emmi AG is currently generating about -0.33 per unit of risk. If you would invest 2,260 in Schlatter Industries AG on September 12, 2024 and sell it today you would earn a total of 40.00 from holding Schlatter Industries AG or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.82% |
| Values | Daily Returns |
Schlatter Industries AG vs. Emmi AG
Performance |
| Timeline |
| Schlatter Industries |
| Emmi AG |
Schlatter Industries and Emmi AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schlatter Industries and Emmi AG
The main advantage of trading using opposite Schlatter Industries and Emmi AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schlatter Industries position performs unexpectedly, Emmi AG 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 Emmi AG will offset losses from the drop in Emmi AG's long position.| Schlatter Industries vs. Sulzer AG | Schlatter Industries vs. Helvetia Holding AG | Schlatter Industries vs. Swiss Life Holding | Schlatter Industries vs. Adecco Group AG |
| Emmi AG vs. Relief Therapeutics Holding | Emmi AG vs. Ams AG | Emmi AG vs. Logitech International SA | Emmi AG vs. SPDR Dow Jones |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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