Correlation Between Talanx AG and Sinopharm Group
Can any of the company-specific risk be diversified away by investing in both Talanx AG and Sinopharm Group 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 Talanx AG and Sinopharm Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Talanx AG and Sinopharm Group Co, you can compare the effects of market volatilities on Talanx AG and Sinopharm Group 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 Talanx AG with a short position of Sinopharm Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Talanx AG and Sinopharm Group.
Diversification Opportunities for Talanx AG and Sinopharm Group
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Talanx and Sinopharm is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Talanx AG and Sinopharm Group Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinopharm Group and Talanx AG 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 Talanx AG are associated (or correlated) with Sinopharm Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinopharm Group has no effect on the direction of Talanx AG i.e., Talanx AG and Sinopharm Group go up and down completely randomly.
Pair Corralation between Talanx AG and Sinopharm Group
Assuming the 90 days horizon Talanx AG is expected to generate 0.58 times more return on investment than Sinopharm Group. However, Talanx AG is 1.73 times less risky than Sinopharm Group. It trades about 0.36 of its potential returns per unit of risk. Sinopharm Group Co is currently generating about 0.09 per unit of risk. If you would invest 7,140 in Talanx AG on August 28, 2024 and sell it today you would earn a total of 730.00 from holding Talanx AG or generate 10.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Talanx AG vs. Sinopharm Group Co
Performance |
| Timeline |
| Talanx AG |
| Sinopharm Group |
Talanx AG and Sinopharm Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Talanx AG and Sinopharm Group
The main advantage of trading using opposite Talanx AG and Sinopharm Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Talanx AG position performs unexpectedly, Sinopharm Group 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 Sinopharm Group will offset losses from the drop in Sinopharm Group's long position.| Talanx AG vs. EAST SIDE GAMES | Talanx AG vs. Hochschild Mining plc | Talanx AG vs. National Beverage Corp | Talanx AG vs. The Boston Beer |
| Sinopharm Group vs. CarsalesCom | Sinopharm Group vs. FUTURE GAMING GRP | Sinopharm Group vs. HOCHSCHILD MINING | Sinopharm Group vs. Globe Trade Centre |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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