Correlation Between UmweltBank and Five Below
Can any of the company-specific risk be diversified away by investing in both UmweltBank and Five Below 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 UmweltBank and Five Below into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UmweltBank AG and Five Below, you can compare the effects of market volatilities on UmweltBank and Five Below 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 UmweltBank with a short position of Five Below. Check out your portfolio center. Please also check ongoing floating volatility patterns of UmweltBank and Five Below.
Diversification Opportunities for UmweltBank and Five Below
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between UmweltBank and Five is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding UmweltBank AG and Five Below in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Five Below and UmweltBank 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 UmweltBank AG are associated (or correlated) with Five Below. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Five Below has no effect on the direction of UmweltBank i.e., UmweltBank and Five Below go up and down completely randomly.
Pair Corralation between UmweltBank and Five Below
Assuming the 90 days trading horizon UmweltBank AG is expected to generate 0.35 times more return on investment than Five Below. However, UmweltBank AG is 2.87 times less risky than Five Below. It trades about -0.09 of its potential returns per unit of risk. Five Below is currently generating about -0.27 per unit of risk. If you would invest 624.00 in UmweltBank AG on October 25, 2024 and sell it today you would lose (12.00) from holding UmweltBank AG or give up 1.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UmweltBank AG vs. Five Below
Performance |
| Timeline |
| UmweltBank AG |
| Five Below |
UmweltBank and Five Below Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UmweltBank and Five Below
The main advantage of trading using opposite UmweltBank and Five Below positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UmweltBank position performs unexpectedly, Five Below 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 Five Below will offset losses from the drop in Five Below's long position.| UmweltBank vs. MAVEN WIRELESS SWEDEN | UmweltBank vs. DATATEC LTD 2 | UmweltBank vs. Datadog | UmweltBank vs. CITY OFFICE REIT |
| Five Below vs. Eurasia Mining Plc | Five Below vs. MOUNT GIBSON IRON | Five Below vs. Tianjin Capital Environmental | Five Below vs. STGEORGE MINING LTD |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |