Correlation Between 06406RAZ0 and IPG Photonics
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By analyzing existing cross correlation between BK 19 25 JAN 29 and IPG Photonics, you can compare the effects of market volatilities on 06406RAZ0 and IPG Photonics 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 06406RAZ0 with a short position of IPG Photonics. Check out your portfolio center. Please also check ongoing floating volatility patterns of 06406RAZ0 and IPG Photonics.
Diversification Opportunities for 06406RAZ0 and IPG Photonics
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between 06406RAZ0 and IPG is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding BK 19 25 JAN 29 and IPG Photonics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IPG Photonics and 06406RAZ0 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 BK 19 25 JAN 29 are associated (or correlated) with IPG Photonics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IPG Photonics has no effect on the direction of 06406RAZ0 i.e., 06406RAZ0 and IPG Photonics go up and down completely randomly.
Pair Corralation between 06406RAZ0 and IPG Photonics
Assuming the 90 days trading horizon BK 19 25 JAN 29 is expected to under-perform the IPG Photonics. But the bond apears to be less risky and, when comparing its historical volatility, BK 19 25 JAN 29 is 1.96 times less risky than IPG Photonics. The bond trades about -0.3 of its potential returns per unit of risk. The IPG Photonics is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 8,096 in IPG Photonics on September 1, 2024 and sell it today you would lose (292.00) from holding IPG Photonics or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 76.19% |
| Values | Daily Returns |
BK 19 25 JAN 29 vs. IPG Photonics
Performance |
| Timeline |
| 06406RAZ0 |
| IPG Photonics |
06406RAZ0 and IPG Photonics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 06406RAZ0 and IPG Photonics
The main advantage of trading using opposite 06406RAZ0 and IPG Photonics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 06406RAZ0 position performs unexpectedly, IPG Photonics 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 IPG Photonics will offset losses from the drop in IPG Photonics' long position.| 06406RAZ0 vs. IPG Photonics | 06406RAZ0 vs. Freedom Internet Group | 06406RAZ0 vs. Apogee Enterprises | 06406RAZ0 vs. Chemours Co |
| IPG Photonics vs. Teradyne | IPG Photonics vs. Ultra Clean Holdings | IPG Photonics vs. Onto Innovation | IPG Photonics vs. Cohu 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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