Correlation Between EMS CHEMIE and Gurit Holding

Can any of the company-specific risk be diversified away by investing in both EMS CHEMIE and Gurit 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 EMS CHEMIE and Gurit Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EMS CHEMIE HOLDING AG and Gurit Holding AG, you can compare the effects of market volatilities on EMS CHEMIE and Gurit 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 EMS CHEMIE with a short position of Gurit Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMS CHEMIE and Gurit Holding.

Diversification Opportunities for EMS CHEMIE and Gurit Holding

0.0

Correlation Coefficient

EMS CHEMIE  Gurit Holding

Pay attention - limited upside

The 3 months correlation between EMS and Gurit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EMS CHEMIE HOLDING AG and Gurit Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gurit Holding AG and EMS CHEMIE 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 EMS CHEMIE HOLDING AG are associated (or correlated) with Gurit Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gurit Holding AG has no effect on the direction of EMS CHEMIE i.e., EMS CHEMIE and Gurit Holding go up and down completely randomly.

Pair Corralation between EMS CHEMIE and Gurit Holding

If you would invest (100.00) in Gurit Holding AG on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Gurit Holding AG or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

EMS CHEMIE HOLDING AG  vs.  Gurit Holding AG

EMS CHEMIE HOLDING

Risk-Adjusted Performance

Very Weak

Over the last 90 days EMS CHEMIE HOLDING AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, EMS CHEMIE is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Gurit Holding AG

Risk-Adjusted Performance

Weak

Over the last 90 days Gurit Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Gurit Holding is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with EMS CHEMIE and Gurit Holding

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

The idea behind EMS CHEMIE HOLDING AG and Gurit Holding AG 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.