Correlation Between Pictet Ch and Julius Baer

Can any of the company-specific risk be diversified away by investing in both Pictet Ch and Julius Baer 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 Pictet Ch and Julius Baer into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pictet Ch Precious and Julius Baer Edelweiss, you can compare the effects of market volatilities on Pictet Ch and Julius Baer 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 Pictet Ch with a short position of Julius Baer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pictet Ch and Julius Baer.

Diversification Opportunities for Pictet Ch and Julius Baer

0.39

Correlation Coefficient

Pictet Ch  Julius Baer

Weak diversification

The 3 months correlation between Pictet and Julius is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Pictet Ch Precious and Julius Baer Edelweiss in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Julius Baer Edelweiss and Pictet Ch 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 Pictet Ch Precious are associated (or correlated) with Julius Baer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Julius Baer Edelweiss has no effect on the direction of Pictet Ch i.e., Pictet Ch and Julius Baer go up and down completely randomly.

Pair Corralation between Pictet Ch and Julius Baer

Assuming the 90 days trading horizon Pictet Ch Precious is expected to generate 1.22 times more return on investment than Julius Baer. However, Pictet Ch is 1.22 times more volatile than Julius Baer Edelweiss. It trades about 0.08 of its potential returns per unit of risk. Julius Baer Edelweiss is currently generating about 0.03 per unit of risk. If you would invest  17,535  in Pictet Ch Precious on September 27, 2024 and sell it today you would earn a total of  6,703  from holding Pictet Ch Precious or generate 38.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.53%
Values	Daily Returns

Pictet Ch Precious  vs.  Julius Baer Edelweiss

Pictet Ch Precious

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pictet Ch Precious has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy basic indicators, Pictet Ch is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Julius Baer Edelweiss

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Julius Baer Edelweiss has generated negative risk-adjusted returns adding no value to fund investors. Despite latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Pictet Ch and Julius Baer

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

The idea behind Pictet Ch Precious and Julius Baer Edelweiss 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.