Correlation Between Carlo Gavazzi and Also Holding
Can any of the company-specific risk be diversified away by investing in both Carlo Gavazzi and Also Holding 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 Carlo Gavazzi and Also Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carlo Gavazzi Holding and Also Holding AG, you can compare the effects of market volatilities on Carlo Gavazzi and Also Holding 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 Carlo Gavazzi with a short position of Also Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carlo Gavazzi and Also Holding.
Diversification Opportunities for Carlo Gavazzi and Also Holding
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Carlo and Also is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Carlo Gavazzi Holding and Also Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Also Holding AG and Carlo Gavazzi 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 Carlo Gavazzi Holding are associated (or correlated) with Also Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Also Holding AG has no effect on the direction of Carlo Gavazzi i.e., Carlo Gavazzi and Also Holding go up and down completely randomly.
Pair Corralation between Carlo Gavazzi and Also Holding
Assuming the 90 days trading horizon Carlo Gavazzi Holding is expected to generate 1.65 times more return on investment than Also Holding. However, Carlo Gavazzi is 1.65 times more volatile than Also Holding AG. It trades about 0.0 of its potential returns per unit of risk. Also Holding AG is currently generating about -0.23 per unit of risk. If you would invest 19,700 in Carlo Gavazzi Holding on September 18, 2024 and sell it today you would lose (100.00) from holding Carlo Gavazzi Holding or give up 0.51% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.24% |
Values | Daily Returns |
Carlo Gavazzi Holding vs. Also Holding AG
Performance |
Timeline |
Carlo Gavazzi Holding |
Also Holding AG |
Carlo Gavazzi and Also Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Carlo Gavazzi and Also Holding
The main advantage of trading using opposite Carlo Gavazzi and Also Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carlo Gavazzi position performs unexpectedly, Also Holding 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 Also Holding will offset losses from the drop in Also Holding's long position.Carlo Gavazzi vs. Bucher Industries AG | Carlo Gavazzi vs. Komax Holding AG | Carlo Gavazzi vs. Comet Holding AG | Carlo Gavazzi vs. Bachem Holding AG |
Also Holding vs. Hubersuhner AG | Also Holding vs. Implenia AG | Also Holding vs. Carlo Gavazzi Holding | Also Holding vs. Mikron Holding 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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