Correlation Between ALBIS LEASING and CDL INVESTMENT

Can any of the company-specific risk be diversified away by investing in both ALBIS LEASING and CDL INVESTMENT 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 CDL INVESTMENT 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 CDL INVESTMENT, you can compare the effects of market volatilities on ALBIS LEASING and CDL INVESTMENT 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 CDL INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALBIS LEASING and CDL INVESTMENT.

Diversification Opportunities for ALBIS LEASING and CDL INVESTMENT

-0.21

Correlation Coefficient

ALBIS LEASING  CDL INVESTMENT

Very good diversification

The 3 months correlation between ALBIS and CDL is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding ALBIS LEASING AG and CDL INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDL INVESTMENT 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 CDL INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDL INVESTMENT has no effect on the direction of ALBIS LEASING i.e., ALBIS LEASING and CDL INVESTMENT go up and down completely randomly.

Pair Corralation between ALBIS LEASING and CDL INVESTMENT

Assuming the 90 days trading horizon ALBIS LEASING AG is expected to under-perform the CDL INVESTMENT. But the stock apears to be less risky and, when comparing its historical volatility, ALBIS LEASING AG is 4.58 times less risky than CDL INVESTMENT. The stock trades about -0.09 of its potential returns per unit of risk. The CDL INVESTMENT is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  43.00  in CDL INVESTMENT on September 13, 2024 and sell it today you would earn a total of  0.00  from holding CDL INVESTMENT or generate 0.0% return on investment over 90 days.

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

ALBIS LEASING AG  vs.  CDL INVESTMENT

ALBIS LEASING AG

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ALBIS LEASING AG are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, ALBIS LEASING may actually be approaching a critical reversion point that can send shares even higher in January 2025.

CDL INVESTMENT

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CDL INVESTMENT are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, CDL INVESTMENT is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with ALBIS LEASING and CDL INVESTMENT

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

The idea behind ALBIS LEASING AG and CDL INVESTMENT 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.