Correlation Between Schweiter Technologies and Chocoladefabriken
Can any of the company-specific risk be diversified away by investing in both Schweiter Technologies and Chocoladefabriken 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 Schweiter Technologies and Chocoladefabriken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweiter Technologies AG and Chocoladefabriken Lindt Spruengli, you can compare the effects of market volatilities on Schweiter Technologies and Chocoladefabriken 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 Schweiter Technologies with a short position of Chocoladefabriken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweiter Technologies and Chocoladefabriken.
Diversification Opportunities for Schweiter Technologies and Chocoladefabriken
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Schweiter and Chocoladefabriken is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Schweiter Technologies AG and Chocoladefabriken Lindt Spruen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and Schweiter Technologies 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 Schweiter Technologies AG are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of Schweiter Technologies i.e., Schweiter Technologies and Chocoladefabriken go up and down completely randomly.
Pair Corralation between Schweiter Technologies and Chocoladefabriken
Assuming the 90 days trading horizon Schweiter Technologies AG is expected to generate 1.77 times more return on investment than Chocoladefabriken. However, Schweiter Technologies is 1.77 times more volatile than Chocoladefabriken Lindt Spruengli. It trades about 0.32 of its potential returns per unit of risk. Chocoladefabriken Lindt Spruengli is currently generating about 0.17 per unit of risk. If you would invest 40,350 in Schweiter Technologies AG on October 23, 2024 and sell it today you would earn a total of 4,200 from holding Schweiter Technologies AG or generate 10.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schweiter Technologies AG vs. Chocoladefabriken Lindt Spruen
Performance |
| Timeline |
| Schweiter Technologies |
| Chocoladefabriken Lindt |
Schweiter Technologies and Chocoladefabriken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schweiter Technologies and Chocoladefabriken
The main advantage of trading using opposite Schweiter Technologies and Chocoladefabriken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweiter Technologies position performs unexpectedly, Chocoladefabriken 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 Chocoladefabriken will offset losses from the drop in Chocoladefabriken's long position.| Schweiter Technologies vs. OC Oerlikon Corp | Schweiter Technologies vs. Helvetia Holding AG | Schweiter Technologies vs. Swiss Life Holding | Schweiter Technologies vs. VAT Group AG |
| Chocoladefabriken vs. Metall Zug AG | Chocoladefabriken vs. Schweiter Technologies AG | Chocoladefabriken vs. Zuger Kantonalbank | Chocoladefabriken vs. Cembra Money Bank |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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