Correlation Between Straumann Holding and Teleperformance
Can any of the company-specific risk be diversified away by investing in both Straumann Holding and Teleperformance 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 Straumann Holding and Teleperformance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Straumann Holding AG and Teleperformance PK, you can compare the effects of market volatilities on Straumann Holding and Teleperformance 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 Straumann Holding with a short position of Teleperformance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Straumann Holding and Teleperformance.
Diversification Opportunities for Straumann Holding and Teleperformance
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Straumann and Teleperformance is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Straumann Holding AG and Teleperformance PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teleperformance PK and Straumann Holding 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 Straumann Holding AG are associated (or correlated) with Teleperformance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teleperformance PK has no effect on the direction of Straumann Holding i.e., Straumann Holding and Teleperformance go up and down completely randomly.
Pair Corralation between Straumann Holding and Teleperformance
Assuming the 90 days horizon Straumann Holding AG is expected to generate 1.2 times more return on investment than Teleperformance. However, Straumann Holding is 1.2 times more volatile than Teleperformance PK. It trades about 0.02 of its potential returns per unit of risk. Teleperformance PK is currently generating about -0.05 per unit of risk. If you would invest 11,553 in Straumann Holding AG on September 24, 2024 and sell it today you would earn a total of 1,089 from holding Straumann Holding AG or generate 9.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Straumann Holding AG vs. Teleperformance PK
Performance |
Timeline |
Straumann Holding |
Teleperformance PK |
Straumann Holding and Teleperformance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Straumann Holding and Teleperformance
The main advantage of trading using opposite Straumann Holding and Teleperformance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Straumann Holding position performs unexpectedly, Teleperformance 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 Teleperformance will offset losses from the drop in Teleperformance's long position.Straumann Holding vs. Sysmex Corp | Straumann Holding vs. Straumann Holding AG | Straumann Holding vs. Coloplast AS | Straumann Holding vs. Essilor International SA |
Teleperformance vs. Cintas | Teleperformance vs. Thomson Reuters Corp | Teleperformance vs. Global Payments | Teleperformance vs. Wolters Kluwer NV |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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