Correlation Between Zehnder and Schweiter Technologies
Can any of the company-specific risk be diversified away by investing in both Zehnder and Schweiter Technologies 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 Zehnder and Schweiter Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zehnder and Schweiter Technologies AG, you can compare the effects of market volatilities on Zehnder and Schweiter Technologies 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 Zehnder with a short position of Schweiter Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zehnder and Schweiter Technologies.
Diversification Opportunities for Zehnder and Schweiter Technologies
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Zehnder and Schweiter is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Zehnder and Schweiter Technologies AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schweiter Technologies and Zehnder 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 Zehnder are associated (or correlated) with Schweiter Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schweiter Technologies has no effect on the direction of Zehnder i.e., Zehnder and Schweiter Technologies go up and down completely randomly.
Pair Corralation between Zehnder and Schweiter Technologies
Assuming the 90 days trading horizon Zehnder is expected to generate 1.11 times more return on investment than Schweiter Technologies. However, Zehnder is 1.11 times more volatile than Schweiter Technologies AG. It trades about 0.01 of its potential returns per unit of risk. Schweiter Technologies AG is currently generating about -0.02 per unit of risk. If you would invest 4,515 in Zehnder on September 2, 2024 and sell it today you would earn a total of 80.00 from holding Zehnder or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zehnder vs. Schweiter Technologies AG
Performance |
| Timeline |
| Zehnder |
| Schweiter Technologies |
Zehnder and Schweiter Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zehnder and Schweiter Technologies
The main advantage of trading using opposite Zehnder and Schweiter Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zehnder position performs unexpectedly, Schweiter Technologies 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 Schweiter Technologies will offset losses from the drop in Schweiter Technologies' long position.| Zehnder vs. Comet Holding AG | Zehnder vs. Schweiter Technologies AG | Zehnder vs. Bossard Holding AG | Zehnder vs. Bachem Holding AG |
| Schweiter Technologies vs. OC Oerlikon Corp | Schweiter Technologies vs. Helvetia Holding AG | Schweiter Technologies vs. Swiss Life Holding | Schweiter Technologies vs. VAT Group 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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