Correlation Between Vienna Insurance and Waste Management
Can any of the company-specific risk be diversified away by investing in both Vienna Insurance and Waste Management 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 Waste Management 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 Waste Management, you can compare the effects of market volatilities on Vienna Insurance and Waste Management 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 Waste Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vienna Insurance and Waste Management.
Diversification Opportunities for Vienna Insurance and Waste Management
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vienna and Waste is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Vienna Insurance Group and Waste Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Waste Management 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 Waste Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Waste Management has no effect on the direction of Vienna Insurance i.e., Vienna Insurance and Waste Management go up and down completely randomly.
Pair Corralation between Vienna Insurance and Waste Management
Assuming the 90 days trading horizon Vienna Insurance Group is expected to generate 0.95 times more return on investment than Waste Management. However, Vienna Insurance Group is 1.06 times less risky than Waste Management. It trades about 0.1 of its potential returns per unit of risk. Waste Management is currently generating about 0.07 per unit of risk. If you would invest 2,474 in Vienna Insurance Group on November 8, 2024 and sell it today you would earn a total of 776.00 from holding Vienna Insurance Group or generate 31.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vienna Insurance Group vs. Waste Management
Performance |
| Timeline |
| Vienna Insurance |
| Waste Management |
Vienna Insurance and Waste Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vienna Insurance and Waste Management
The main advantage of trading using opposite Vienna Insurance and Waste Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vienna Insurance position performs unexpectedly, Waste Management 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 Waste Management will offset losses from the drop in Waste Management's long position.| Vienna Insurance vs. Guangdong Investment Limited | Vienna Insurance vs. Gruppo Mutuionline SpA | Vienna Insurance vs. PennantPark Investment | Vienna Insurance vs. Chuangs China Investments |
| Waste Management vs. GRIFFIN MINING LTD | Waste Management vs. Norwegian Air Shuttle | Waste Management vs. ALTAIR RES INC | Waste Management vs. SYSTEMAIR AB |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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