Correlation Between Vienna Insurance and Grenke AG
Can any of the company-specific risk be diversified away by investing in both Vienna Insurance and Grenke AG 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 Vienna Insurance and Grenke AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vienna Insurance Group and Grenke AG, you can compare the effects of market volatilities on Vienna Insurance and Grenke AG 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 Vienna Insurance with a short position of Grenke AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vienna Insurance and Grenke AG.
Diversification Opportunities for Vienna Insurance and Grenke AG
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Vienna and Grenke is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Vienna Insurance Group and Grenke AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grenke AG and Vienna Insurance 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 Vienna Insurance Group are associated (or correlated) with Grenke AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grenke AG has no effect on the direction of Vienna Insurance i.e., Vienna Insurance and Grenke AG go up and down completely randomly.
Pair Corralation between Vienna Insurance and Grenke AG
Assuming the 90 days trading horizon Vienna Insurance Group is expected to generate 0.46 times more return on investment than Grenke AG. However, Vienna Insurance Group is 2.16 times less risky than Grenke AG. It trades about 0.1 of its potential returns per unit of risk. Grenke AG is currently generating about -0.03 per unit of risk. If you would invest 2,470 in Vienna Insurance Group on November 4, 2024 and sell it today you would earn a total of 770.00 from holding Vienna Insurance Group or generate 31.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vienna Insurance Group vs. Grenke AG
Performance |
| Timeline |
| Vienna Insurance |
| Grenke AG |
Vienna Insurance and Grenke AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vienna Insurance and Grenke AG
The main advantage of trading using opposite Vienna Insurance and Grenke AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vienna Insurance position performs unexpectedly, Grenke AG 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 Grenke AG will offset losses from the drop in Grenke AG's long position.| Vienna Insurance vs. PATTIES FOODS | Vienna Insurance vs. Alaska Air Group | Vienna Insurance vs. Fair Isaac Corp | Vienna Insurance vs. FORWARD AIR P |
| Grenke AG vs. H2O Retailing | Grenke AG vs. CarsalesCom | Grenke AG vs. Indutrade AB | Grenke AG vs. TRADELINK ELECTRON |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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