Correlation Between ZALANDO SE and Cellnex Telecom
Can any of the company-specific risk be diversified away by investing in both ZALANDO SE and Cellnex Telecom 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 ZALANDO SE and Cellnex Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZALANDO SE ADR and Cellnex Telecom SA, you can compare the effects of market volatilities on ZALANDO SE and Cellnex Telecom 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 ZALANDO SE with a short position of Cellnex Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZALANDO SE and Cellnex Telecom.
Diversification Opportunities for ZALANDO SE and Cellnex Telecom
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ZALANDO and Cellnex is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding ZALANDO SE ADR and Cellnex Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellnex Telecom SA and ZALANDO SE 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 ZALANDO SE ADR are associated (or correlated) with Cellnex Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellnex Telecom SA has no effect on the direction of ZALANDO SE i.e., ZALANDO SE and Cellnex Telecom go up and down completely randomly.
Pair Corralation between ZALANDO SE and Cellnex Telecom
Assuming the 90 days horizon ZALANDO SE ADR is expected to generate 1.42 times more return on investment than Cellnex Telecom. However, ZALANDO SE is 1.42 times more volatile than Cellnex Telecom SA. It trades about 0.07 of its potential returns per unit of risk. Cellnex Telecom SA is currently generating about -0.02 per unit of risk. If you would invest 1,321 in ZALANDO SE ADR on September 1, 2024 and sell it today you would earn a total of 230.00 from holding ZALANDO SE ADR or generate 17.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
ZALANDO SE ADR vs. Cellnex Telecom SA
Performance |
| Timeline |
| ZALANDO SE ADR |
| Cellnex Telecom SA |
ZALANDO SE and Cellnex Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZALANDO SE and Cellnex Telecom
The main advantage of trading using opposite ZALANDO SE and Cellnex Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZALANDO SE position performs unexpectedly, Cellnex Telecom 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 Cellnex Telecom will offset losses from the drop in Cellnex Telecom's long position.| ZALANDO SE vs. PDD Holdings | ZALANDO SE vs. JD Inc Adr | ZALANDO SE vs. Baozun Inc | ZALANDO SE vs. Global E Online |
| Cellnex Telecom vs. IRSA Inversiones Y | Cellnex Telecom vs. Anywhere Real Estate | Cellnex Telecom vs. Newmark Group | Cellnex Telecom vs. New York City |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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