Correlation Between MARKET VECTR and Siemens Healthineers
Can any of the company-specific risk be diversified away by investing in both MARKET VECTR and Siemens Healthineers 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 MARKET VECTR and Siemens Healthineers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MARKET VECTR RETAIL and Siemens Healthineers AG, you can compare the effects of market volatilities on MARKET VECTR and Siemens Healthineers 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 MARKET VECTR with a short position of Siemens Healthineers. Check out your portfolio center. Please also check ongoing floating volatility patterns of MARKET VECTR and Siemens Healthineers.
Diversification Opportunities for MARKET VECTR and Siemens Healthineers
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MARKET and Siemens is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding MARKET VECTR RETAIL and Siemens Healthineers AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Healthineers and MARKET VECTR 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 MARKET VECTR RETAIL are associated (or correlated) with Siemens Healthineers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Healthineers has no effect on the direction of MARKET VECTR i.e., MARKET VECTR and Siemens Healthineers go up and down completely randomly.
Pair Corralation between MARKET VECTR and Siemens Healthineers
Assuming the 90 days trading horizon MARKET VECTR RETAIL is expected to generate 0.54 times more return on investment than Siemens Healthineers. However, MARKET VECTR RETAIL is 1.85 times less risky than Siemens Healthineers. It trades about 0.41 of its potential returns per unit of risk. Siemens Healthineers AG is currently generating about 0.21 per unit of risk. If you would invest 21,925 in MARKET VECTR RETAIL on November 7, 2024 and sell it today you would earn a total of 1,215 from holding MARKET VECTR RETAIL or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
MARKET VECTR RETAIL vs. Siemens Healthineers AG
Performance |
| Timeline |
| MARKET VECTR RETAIL |
| Siemens Healthineers |
MARKET VECTR and Siemens Healthineers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MARKET VECTR and Siemens Healthineers
The main advantage of trading using opposite MARKET VECTR and Siemens Healthineers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MARKET VECTR position performs unexpectedly, Siemens Healthineers 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 Siemens Healthineers will offset losses from the drop in Siemens Healthineers' long position.| MARKET VECTR vs. LAir Liquide SA | MARKET VECTR vs. HF SINCLAIR P | MARKET VECTR vs. Corsair Gaming | MARKET VECTR vs. Ryanair Holdings plc |
| Siemens Healthineers vs. PLANT VEDA FOODS | Siemens Healthineers vs. PREMIER FOODS | Siemens Healthineers vs. MONEYSUPERMARKET | Siemens Healthineers vs. Tyson Foods |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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