Correlation Between ALBIS LEASING and Wynn Macau

Can any of the company-specific risk be diversified away by investing in both ALBIS LEASING and Wynn Macau 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 ALBIS LEASING and Wynn Macau into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ALBIS LEASING AG and Wynn Macau Limited, you can compare the effects of market volatilities on ALBIS LEASING and Wynn Macau 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 ALBIS LEASING with a short position of Wynn Macau. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALBIS LEASING and Wynn Macau.

Diversification Opportunities for ALBIS LEASING and Wynn Macau

-0.11

Correlation Coefficient

ALBIS LEASING  Wynn Macau

Good diversification

The 3 months correlation between ALBIS and Wynn is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding ALBIS LEASING AG and Wynn Macau Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wynn Macau Limited and ALBIS LEASING 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 ALBIS LEASING AG are associated (or correlated) with Wynn Macau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wynn Macau Limited has no effect on the direction of ALBIS LEASING i.e., ALBIS LEASING and Wynn Macau go up and down completely randomly.

Pair Corralation between ALBIS LEASING and Wynn Macau

Assuming the 90 days trading horizon ALBIS LEASING AG is expected to generate 0.21 times more return on investment than Wynn Macau. However, ALBIS LEASING AG is 4.7 times less risky than Wynn Macau. It trades about -0.02 of its potential returns per unit of risk. Wynn Macau Limited is currently generating about -0.01 per unit of risk. If you would invest  278.00  in ALBIS LEASING AG on December 19, 2024 and sell it today you would lose (2.00) from holding ALBIS LEASING AG or give up 0.72% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

ALBIS LEASING AG  vs.  Wynn Macau Limited

ALBIS LEASING AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALBIS LEASING AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, ALBIS LEASING is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Wynn Macau Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wynn Macau Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Wynn Macau is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ALBIS LEASING and Wynn Macau

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

The idea behind ALBIS LEASING AG and Wynn Macau Limited 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.