Correlation Between Schweiter Technologies and Inficon Holding
Can any of the company-specific risk be diversified away by investing in both Schweiter Technologies and Inficon 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 Schweiter Technologies and Inficon Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schweiter Technologies AG and Inficon Holding, you can compare the effects of market volatilities on Schweiter Technologies and Inficon 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 Schweiter Technologies with a short position of Inficon Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schweiter Technologies and Inficon Holding.
Diversification Opportunities for Schweiter Technologies and Inficon Holding
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Schweiter and Inficon is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Schweiter Technologies AG and Inficon Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inficon Holding and Schweiter Technologies 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 Schweiter Technologies AG are associated (or correlated) with Inficon Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inficon Holding has no effect on the direction of Schweiter Technologies i.e., Schweiter Technologies and Inficon Holding go up and down completely randomly.
Pair Corralation between Schweiter Technologies and Inficon Holding
Assuming the 90 days trading horizon Schweiter Technologies AG is expected to generate 1.4 times more return on investment than Inficon Holding. However, Schweiter Technologies is 1.4 times more volatile than Inficon Holding. It trades about 0.03 of its potential returns per unit of risk. Inficon Holding is currently generating about -0.11 per unit of risk. If you would invest 38,850 in Schweiter Technologies AG on September 17, 2024 and sell it today you would earn a total of 1,350 from holding Schweiter Technologies AG or generate 3.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Schweiter Technologies AG vs. Inficon Holding
Performance |
Timeline |
Schweiter Technologies |
Inficon Holding |
Schweiter Technologies and Inficon Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Schweiter Technologies and Inficon Holding
The main advantage of trading using opposite Schweiter Technologies and Inficon Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schweiter Technologies position performs unexpectedly, Inficon 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 Inficon Holding will offset losses from the drop in Inficon Holding's long position.Schweiter Technologies vs. Inficon Holding | Schweiter Technologies vs. Bucher Industries AG | Schweiter Technologies vs. Sulzer AG | Schweiter Technologies vs. EMS CHEMIE HOLDING AG |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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