Correlation Between SLR Investment and Materialise
Can any of the company-specific risk be diversified away by investing in both SLR Investment and Materialise 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 SLR Investment and Materialise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SLR Investment Corp and Materialise NV, you can compare the effects of market volatilities on SLR Investment and Materialise 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 SLR Investment with a short position of Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and Materialise.
Diversification Opportunities for SLR Investment and Materialise
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SLR and Materialise is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV and SLR Investment 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 SLR Investment Corp are associated (or correlated) with Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of SLR Investment i.e., SLR Investment and Materialise go up and down completely randomly.
Pair Corralation between SLR Investment and Materialise
Assuming the 90 days horizon SLR Investment is expected to generate 3.05 times less return on investment than Materialise. But when comparing it to its historical volatility, SLR Investment Corp is 3.0 times less risky than Materialise. It trades about 0.19 of its potential returns per unit of risk. Materialise NV is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 650.00 in Materialise NV on September 13, 2024 and sell it today you would earn a total of 110.00 from holding Materialise NV or generate 16.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SLR Investment Corp vs. Materialise NV
Performance |
| Timeline |
| SLR Investment Corp |
| Materialise NV |
SLR Investment and Materialise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLR Investment and Materialise
The main advantage of trading using opposite SLR Investment and Materialise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, Materialise 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 Materialise will offset losses from the drop in Materialise's long position.| SLR Investment vs. EVS Broadcast Equipment | SLR Investment vs. Summit Hotel Properties | SLR Investment vs. Park Hotels Resorts | SLR Investment vs. BROADSTNET LEADL 00025 |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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