Correlation Between GRENKELEASING Dusseldorf and Henry Schein

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

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

Diversification Opportunities for GRENKELEASING Dusseldorf and Henry Schein

0.47

Correlation Coefficient

GRENKELEASING Dusseldorf  Henry Schein

Very weak diversification

The 3 months correlation between GRENKELEASING and Henry is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding GRENKELEASING Dusseldorf and Henry Schein in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henry Schein 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 Henry Schein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henry Schein has no effect on the direction of GRENKELEASING Dusseldorf i.e., GRENKELEASING Dusseldorf and Henry Schein go up and down completely randomly.

Pair Corralation between GRENKELEASING Dusseldorf and Henry Schein

Assuming the 90 days trading horizon GRENKELEASING Dusseldorf is expected to under-perform the Henry Schein. In addition to that, GRENKELEASING Dusseldorf is 1.69 times more volatile than Henry Schein. It trades about -0.03 of its total potential returns per unit of risk. Henry Schein is currently generating about -0.02 per unit of volatility. If you would invest  6,688  in Henry Schein on December 22, 2024 and sell it today you would lose (194.00) from holding Henry Schein or give up 2.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

GRENKELEASING Dusseldorf  vs.  Henry Schein

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 newest stock price uproar, may contribute to short-horizon losses for the private investors.

Henry Schein

Risk-Adjusted Performance

Very Weak

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

Pair Trading with GRENKELEASING Dusseldorf and Henry Schein

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

The idea behind GRENKELEASING Dusseldorf and Henry Schein 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..