Correlation Between Julius Baer and Pictet Ch

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

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

Diversification Opportunities for Julius Baer and Pictet Ch

0.39

Correlation Coefficient

Julius Baer  Pictet Ch

Weak diversification

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

Pair Corralation between Julius Baer and Pictet Ch

Assuming the 90 days trading horizon Julius Baer is expected to generate 2.54 times less return on investment than Pictet Ch. But when comparing it to its historical volatility, Julius Baer Edelweiss is 1.2 times less risky than Pictet Ch. It trades about 0.04 of its potential returns per unit of risk. Pictet Ch Precious is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  17,358  in Pictet Ch Precious on September 27, 2024 and sell it today you would earn a total of  6,880  from holding Pictet Ch Precious or generate 39.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.59%
Values	Daily Returns

Julius Baer Edelweiss  vs.  Pictet Ch Precious

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.

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.

Pair Trading with Julius Baer and Pictet Ch

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

The idea behind Julius Baer Edelweiss and Pictet Ch Precious 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.