Correlation Between Vontobel Holding and Chocoladefabriken
Can any of the company-specific risk be diversified away by investing in both Vontobel Holding and Chocoladefabriken 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 Vontobel Holding and Chocoladefabriken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vontobel Holding and Chocoladefabriken Lindt Spruengli, you can compare the effects of market volatilities on Vontobel Holding and Chocoladefabriken 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 Vontobel Holding with a short position of Chocoladefabriken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vontobel Holding and Chocoladefabriken.
Diversification Opportunities for Vontobel Holding and Chocoladefabriken
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Vontobel and Chocoladefabriken is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Vontobel Holding and Chocoladefabriken Lindt Spruen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and Vontobel Holding 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 Vontobel Holding are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of Vontobel Holding i.e., Vontobel Holding and Chocoladefabriken go up and down completely randomly.
Pair Corralation between Vontobel Holding and Chocoladefabriken
Assuming the 90 days trading horizon Vontobel Holding is expected to generate 1.05 times more return on investment than Chocoladefabriken. However, Vontobel Holding is 1.05 times more volatile than Chocoladefabriken Lindt Spruengli. It trades about 0.05 of its potential returns per unit of risk. Chocoladefabriken Lindt Spruengli is currently generating about 0.02 per unit of risk. If you would invest 5,239 in Vontobel Holding on November 4, 2024 and sell it today you would earn a total of 1,501 from holding Vontobel Holding or generate 28.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vontobel Holding vs. Chocoladefabriken Lindt Spruen
Performance |
| Timeline |
| Vontobel Holding |
| Chocoladefabriken Lindt |
Vontobel Holding and Chocoladefabriken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vontobel Holding and Chocoladefabriken
The main advantage of trading using opposite Vontobel Holding and Chocoladefabriken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vontobel Holding position performs unexpectedly, Chocoladefabriken 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 Chocoladefabriken will offset losses from the drop in Chocoladefabriken's long position.| Vontobel Holding vs. Julius Baer Gruppe | Vontobel Holding vs. Helvetia Holding AG | Vontobel Holding vs. Sulzer AG | Vontobel Holding vs. Swiss Life Holding |
| Chocoladefabriken vs. Chocoladefabriken Lindt Spruengli | Chocoladefabriken vs. Barry Callebaut AG | Chocoladefabriken vs. Givaudan SA | Chocoladefabriken vs. Geberit 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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