Correlation Between Tradegate and AIR PRODCHEMICALS
Can any of the company-specific risk be diversified away by investing in both Tradegate and AIR PRODCHEMICALS 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 Tradegate and AIR PRODCHEMICALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tradegate AG Wertpapierhandelsbank and AIR PRODCHEMICALS, you can compare the effects of market volatilities on Tradegate and AIR PRODCHEMICALS 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 Tradegate with a short position of AIR PRODCHEMICALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tradegate and AIR PRODCHEMICALS.
Diversification Opportunities for Tradegate and AIR PRODCHEMICALS
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tradegate and AIR is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Tradegate AG Wertpapierhandels and AIR PRODCHEMICALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIR PRODCHEMICALS and Tradegate 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 Tradegate AG Wertpapierhandelsbank are associated (or correlated) with AIR PRODCHEMICALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIR PRODCHEMICALS has no effect on the direction of Tradegate i.e., Tradegate and AIR PRODCHEMICALS go up and down completely randomly.
Pair Corralation between Tradegate and AIR PRODCHEMICALS
Assuming the 90 days horizon Tradegate AG Wertpapierhandelsbank is expected to under-perform the AIR PRODCHEMICALS. But the stock apears to be less risky and, when comparing its historical volatility, Tradegate AG Wertpapierhandelsbank is 2.67 times less risky than AIR PRODCHEMICALS. The stock trades about -0.19 of its potential returns per unit of risk. The AIR PRODCHEMICALS is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 29,320 in AIR PRODCHEMICALS on September 14, 2024 and sell it today you would earn a total of 430.00 from holding AIR PRODCHEMICALS or generate 1.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tradegate AG Wertpapierhandels vs. AIR PRODCHEMICALS
Performance |
| Timeline |
| Tradegate AG Wertpap |
| AIR PRODCHEMICALS |
Tradegate and AIR PRODCHEMICALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tradegate and AIR PRODCHEMICALS
The main advantage of trading using opposite Tradegate and AIR PRODCHEMICALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tradegate position performs unexpectedly, AIR PRODCHEMICALS 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 AIR PRODCHEMICALS will offset losses from the drop in AIR PRODCHEMICALS's long position.| Tradegate vs. Superior Plus Corp | Tradegate vs. SIVERS SEMICONDUCTORS AB | Tradegate vs. CHINA HUARONG ENERHD 50 | Tradegate vs. NORDIC HALIBUT AS |
| AIR PRODCHEMICALS vs. Apple Inc | AIR PRODCHEMICALS vs. Apple Inc | AIR PRODCHEMICALS vs. Apple Inc | AIR PRODCHEMICALS vs. Apple Inc |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |