Correlation Between Wienerberger and RHI Magnesita
Can any of the company-specific risk be diversified away by investing in both Wienerberger and RHI Magnesita 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 Wienerberger and RHI Magnesita into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wienerberger AG and RHI Magnesita NV, you can compare the effects of market volatilities on Wienerberger and RHI Magnesita 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 Wienerberger with a short position of RHI Magnesita. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wienerberger and RHI Magnesita.
Diversification Opportunities for Wienerberger and RHI Magnesita
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wienerberger and RHI is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Wienerberger AG and RHI Magnesita NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RHI Magnesita NV and Wienerberger 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 Wienerberger AG are associated (or correlated) with RHI Magnesita. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RHI Magnesita NV has no effect on the direction of Wienerberger i.e., Wienerberger and RHI Magnesita go up and down completely randomly.
Pair Corralation between Wienerberger and RHI Magnesita
Assuming the 90 days trading horizon Wienerberger AG is expected to under-perform the RHI Magnesita. But the stock apears to be less risky and, when comparing its historical volatility, Wienerberger AG is 1.19 times less risky than RHI Magnesita. The stock trades about -0.19 of its potential returns per unit of risk. The RHI Magnesita NV is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,700 in RHI Magnesita NV on September 19, 2024 and sell it today you would earn a total of 100.00 from holding RHI Magnesita NV or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wienerberger AG vs. RHI Magnesita NV
Performance |
| Timeline |
| Wienerberger AG |
| RHI Magnesita NV |
Wienerberger and RHI Magnesita Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wienerberger and RHI Magnesita
The main advantage of trading using opposite Wienerberger and RHI Magnesita positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wienerberger position performs unexpectedly, RHI Magnesita 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 RHI Magnesita will offset losses from the drop in RHI Magnesita's long position.| Wienerberger vs. Voestalpine AG | Wienerberger vs. OMV Aktiengesellschaft | Wienerberger vs. VERBUND AG | Wienerberger vs. Andritz AG |
| RHI Magnesita vs. AT S Austria | RHI Magnesita vs. Wienerberger AG | RHI Magnesita vs. Lenzing Aktiengesellschaft | RHI Magnesita vs. Voestalpine 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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