Correlation Between Infineon Technologies and AKKO Invest

Can any of the company-specific risk be diversified away by investing in both Infineon Technologies and AKKO Invest 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 Infineon Technologies and AKKO Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Infineon Technologies AG and AKKO Invest Nyrt, you can compare the effects of market volatilities on Infineon Technologies and AKKO Invest 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 Infineon Technologies with a short position of AKKO Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infineon Technologies and AKKO Invest.

Diversification Opportunities for Infineon Technologies and AKKO Invest

-0.21

Correlation Coefficient

Infineon Technologies  AKKO Invest

Very good diversification

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

Pair Corralation between Infineon Technologies and AKKO Invest

Assuming the 90 days trading horizon Infineon Technologies AG is expected to generate 2.19 times more return on investment than AKKO Invest. However, Infineon Technologies is 2.19 times more volatile than AKKO Invest Nyrt. It trades about 0.05 of its potential returns per unit of risk. AKKO Invest Nyrt is currently generating about -0.04 per unit of risk. If you would invest  1,316,098  in Infineon Technologies AG on December 4, 2024 and sell it today you would earn a total of  60,502  from holding Infineon Technologies AG or generate 4.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	71.19%
Values	Daily Returns

Infineon Technologies AG  vs.  AKKO Invest Nyrt

Infineon Technologies

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Infineon Technologies AG are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Infineon Technologies may actually be approaching a critical reversion point that can send shares even higher in April 2025.

AKKO Invest Nyrt

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Infineon Technologies and AKKO Invest

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

The idea behind Infineon Technologies AG and AKKO Invest Nyrt 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.