Correlation Between Implenia and Rieter Holding
Can any of the company-specific risk be diversified away by investing in both Implenia and Rieter 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 Implenia and Rieter Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Implenia AG and Rieter Holding AG, you can compare the effects of market volatilities on Implenia and Rieter 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 Implenia with a short position of Rieter Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Implenia and Rieter Holding.
Diversification Opportunities for Implenia and Rieter Holding
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Implenia and Rieter is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Implenia AG and Rieter Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rieter Holding AG and Implenia 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 Implenia AG are associated (or correlated) with Rieter Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rieter Holding AG has no effect on the direction of Implenia i.e., Implenia and Rieter Holding go up and down completely randomly.
Pair Corralation between Implenia and Rieter Holding
Assuming the 90 days trading horizon Implenia AG is expected to generate 1.0 times more return on investment than Rieter Holding. However, Implenia AG is 1.0 times less risky than Rieter Holding. It trades about 0.22 of its potential returns per unit of risk. Rieter Holding AG is currently generating about -0.06 per unit of risk. If you would invest 3,006 in Implenia AG on December 30, 2024 and sell it today you would earn a total of 1,079 from holding Implenia AG or generate 35.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Implenia AG vs. Rieter Holding AG
Performance |
Timeline |
Implenia AG |
Rieter Holding AG |
Implenia and Rieter Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Implenia and Rieter Holding
The main advantage of trading using opposite Implenia and Rieter Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Implenia position performs unexpectedly, Rieter 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 Rieter Holding will offset losses from the drop in Rieter Holding's long position.Implenia vs. Helvetia Holding AG | Implenia vs. Bucher Industries AG | Implenia vs. Hubersuhner AG | Implenia vs. Stadler Rail AG |
Rieter Holding vs. Autoneum Holding AG | Rieter Holding vs. Sulzer AG | Rieter Holding vs. OC Oerlikon Corp | Rieter Holding vs. Bucher Industries AG |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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