Correlation Between Voestalpine and IShares ATX
Can any of the company-specific risk be diversified away by investing in both Voestalpine and IShares ATX 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 Voestalpine and IShares ATX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voestalpine AG and iShares ATX UCITS, you can compare the effects of market volatilities on Voestalpine and IShares ATX 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 Voestalpine with a short position of IShares ATX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voestalpine and IShares ATX.
Diversification Opportunities for Voestalpine and IShares ATX
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voestalpine and IShares is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Voestalpine AG and iShares ATX UCITS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares ATX UCITS and Voestalpine 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 Voestalpine AG are associated (or correlated) with IShares ATX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares ATX UCITS has no effect on the direction of Voestalpine i.e., Voestalpine and IShares ATX go up and down completely randomly.
Pair Corralation between Voestalpine and IShares ATX
Assuming the 90 days trading horizon Voestalpine AG is expected to under-perform the IShares ATX. In addition to that, Voestalpine is 1.78 times more volatile than iShares ATX UCITS. It trades about -0.03 of its total potential returns per unit of risk. iShares ATX UCITS is currently generating about 0.03 per unit of volatility. If you would invest 3,390 in iShares ATX UCITS on August 30, 2024 and sell it today you would earn a total of 347.00 from holding iShares ATX UCITS or generate 10.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voestalpine AG vs. iShares ATX UCITS
Performance |
| Timeline |
| Voestalpine AG |
| iShares ATX UCITS |
Voestalpine and IShares ATX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voestalpine and IShares ATX
The main advantage of trading using opposite Voestalpine and IShares ATX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voestalpine position performs unexpectedly, IShares ATX 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 IShares ATX will offset losses from the drop in IShares ATX's long position.| Voestalpine vs. OMV Aktiengesellschaft | Voestalpine vs. Raiffeisen Bank International | Voestalpine vs. Andritz AG | Voestalpine vs. VERBUND AG |
| IShares ATX vs. iShares Core DAX | IShares ATX vs. RATH Aktiengesellschaft | IShares ATX vs. AT S Austria | IShares ATX vs. BAWAG Group AG |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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