Correlation Between Schweizer Electronic and Corporate Travel

Can any of the company-specific risk be diversified away by investing in both Schweizer Electronic and Corporate Travel 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 Schweizer Electronic and Corporate Travel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Schweizer Electronic AG and Corporate Travel Management, you can compare the effects of market volatilities on Schweizer Electronic and Corporate Travel 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 Schweizer Electronic with a short position of Corporate Travel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweizer Electronic and Corporate Travel.

Diversification Opportunities for Schweizer Electronic and Corporate Travel

-0.64

Correlation Coefficient

Schweizer Electronic  Corporate Travel

Excellent diversification

The 3 months correlation between Schweizer and Corporate is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Schweizer Electronic AG and Corporate Travel Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Travel Man and Schweizer Electronic 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 Schweizer Electronic AG are associated (or correlated) with Corporate Travel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Travel Man has no effect on the direction of Schweizer Electronic i.e., Schweizer Electronic and Corporate Travel go up and down completely randomly.

Pair Corralation between Schweizer Electronic and Corporate Travel

Assuming the 90 days horizon Schweizer Electronic AG is expected to under-perform the Corporate Travel. In addition to that, Schweizer Electronic is 1.35 times more volatile than Corporate Travel Management. It trades about -0.13 of its total potential returns per unit of risk. Corporate Travel Management is currently generating about 0.01 per unit of volatility. If you would invest  770.00  in Corporate Travel Management on September 28, 2024 and sell it today you would lose (5.00) from holding Corporate Travel Management or give up 0.65% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Schweizer Electronic AG  vs.  Corporate Travel Management

Schweizer Electronic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Schweizer Electronic AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Corporate Travel Man

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Corporate Travel Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Corporate Travel is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Schweizer Electronic and Corporate Travel

The main advantage of trading using opposite Schweizer Electronic and Corporate Travel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweizer Electronic position performs unexpectedly, Corporate Travel 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 Corporate Travel will offset losses from the drop in Corporate Travel's long position.

The idea behind Schweizer Electronic AG and Corporate Travel Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..