Correlation Between WisdomTree Battery and Autoneum Holding
Can any of the company-specific risk be diversified away by investing in both WisdomTree Battery and Autoneum Holding 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 WisdomTree Battery and Autoneum Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree Battery Solutions and Autoneum Holding AG, you can compare the effects of market volatilities on WisdomTree Battery and Autoneum Holding 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 WisdomTree Battery with a short position of Autoneum Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree Battery and Autoneum Holding.
Diversification Opportunities for WisdomTree Battery and Autoneum Holding
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WisdomTree and Autoneum is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree Battery Solutions and Autoneum Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autoneum Holding and WisdomTree Battery 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 WisdomTree Battery Solutions are associated (or correlated) with Autoneum Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autoneum Holding has no effect on the direction of WisdomTree Battery i.e., WisdomTree Battery and Autoneum Holding go up and down completely randomly.
Pair Corralation between WisdomTree Battery and Autoneum Holding
Assuming the 90 days trading horizon WisdomTree Battery Solutions is expected to generate 1.23 times more return on investment than Autoneum Holding. However, WisdomTree Battery is 1.23 times more volatile than Autoneum Holding AG. It trades about 0.1 of its potential returns per unit of risk. Autoneum Holding AG is currently generating about -0.33 per unit of risk. If you would invest 2,998 in WisdomTree Battery Solutions on September 3, 2024 and sell it today you would earn a total of 91.00 from holding WisdomTree Battery Solutions or generate 3.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WisdomTree Battery Solutions vs. Autoneum Holding AG
Performance |
| Timeline |
| WisdomTree Battery |
| Autoneum Holding |
WisdomTree Battery and Autoneum Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree Battery and Autoneum Holding
The main advantage of trading using opposite WisdomTree Battery and Autoneum Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree Battery position performs unexpectedly, Autoneum Holding 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 Autoneum Holding will offset losses from the drop in Autoneum Holding's long position.| WisdomTree Battery vs. WisdomTree Japan Equity | WisdomTree Battery vs. WisdomTree Emerging Markets | WisdomTree Battery vs. WisdomTree Equity Income | WisdomTree Battery vs. WisdomTree Quality Dividend |
| Autoneum Holding vs. Rieter Holding AG | Autoneum Holding vs. Comet Holding AG | Autoneum Holding vs. VAT Group AG | Autoneum Holding vs. Bossard Holding 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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