Correlation Between GRENKELEASING Dusseldorf and CCC SA

Can any of the company-specific risk be diversified away by investing in both GRENKELEASING Dusseldorf and CCC SA 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 GRENKELEASING Dusseldorf and CCC SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GRENKELEASING Dusseldorf and CCC SA, you can compare the effects of market volatilities on GRENKELEASING Dusseldorf and CCC SA 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 GRENKELEASING Dusseldorf with a short position of CCC SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRENKELEASING Dusseldorf and CCC SA.

Diversification Opportunities for GRENKELEASING Dusseldorf and CCC SA

-0.34

Correlation Coefficient

GRENKELEASING Dusseldorf  CCC SA

Very good diversification

The 3 months correlation between GRENKELEASING and CCC is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding GRENKELEASING Dusseldorf and CCC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCC SA and GRENKELEASING Dusseldorf 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 GRENKELEASING Dusseldorf are associated (or correlated) with CCC SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCC SA has no effect on the direction of GRENKELEASING Dusseldorf i.e., GRENKELEASING Dusseldorf and CCC SA go up and down completely randomly.

Pair Corralation between GRENKELEASING Dusseldorf and CCC SA

Assuming the 90 days trading horizon GRENKELEASING Dusseldorf is expected to under-perform the CCC SA. In addition to that, GRENKELEASING Dusseldorf is 1.02 times more volatile than CCC SA. It trades about -0.03 of its total potential returns per unit of risk. CCC SA is currently generating about 0.12 per unit of volatility. If you would invest  4,346  in CCC SA on December 23, 2024 and sell it today you would earn a total of  929.00  from holding CCC SA or generate 21.38% return on investment over 90 days.

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

GRENKELEASING Dusseldorf  vs.  CCC SA

GRENKELEASING Dusseldorf

Risk-Adjusted Performance

Very Weak

Over the last 90 days GRENKELEASING Dusseldorf has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, GRENKELEASING Dusseldorf is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

CCC SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CCC SA are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CCC SA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GRENKELEASING Dusseldorf and CCC SA

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

The idea behind GRENKELEASING Dusseldorf and CCC SA 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.