Correlation Between Infineon Technologies and ALTEO Energiaszolgalta
Can any of the company-specific risk be diversified away by investing in both Infineon Technologies and ALTEO Energiaszolgalta 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 ALTEO Energiaszolgalta 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 ALTEO Energiaszolgaltato Nyrt, you can compare the effects of market volatilities on Infineon Technologies and ALTEO Energiaszolgalta 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 ALTEO Energiaszolgalta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infineon Technologies and ALTEO Energiaszolgalta.
Diversification Opportunities for Infineon Technologies and ALTEO Energiaszolgalta
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Infineon and ALTEO is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Infineon Technologies AG and ALTEO Energiaszolgaltato Nyrt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTEO Energiaszolgalta 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 ALTEO Energiaszolgalta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTEO Energiaszolgalta has no effect on the direction of Infineon Technologies i.e., Infineon Technologies and ALTEO Energiaszolgalta go up and down completely randomly.
Pair Corralation between Infineon Technologies and ALTEO Energiaszolgalta
Assuming the 90 days trading horizon Infineon Technologies AG is expected to generate 3.91 times more return on investment than ALTEO Energiaszolgalta. However, Infineon Technologies is 3.91 times more volatile than ALTEO Energiaszolgaltato Nyrt. It trades about 0.14 of its potential returns per unit of risk. ALTEO Energiaszolgaltato Nyrt is currently generating about -0.12 per unit of risk. If you would invest 1,145,000 in Infineon Technologies AG on September 14, 2024 and sell it today you would earn a total of 228,000 from holding Infineon Technologies AG or generate 19.91% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 64.52% |
Values | Daily Returns |
Infineon Technologies AG vs. ALTEO Energiaszolgaltato Nyrt
Performance |
Timeline |
Infineon Technologies |
ALTEO Energiaszolgalta |
Infineon Technologies and ALTEO Energiaszolgalta Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Infineon Technologies and ALTEO Energiaszolgalta
The main advantage of trading using opposite Infineon Technologies and ALTEO Energiaszolgalta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infineon Technologies position performs unexpectedly, ALTEO Energiaszolgalta 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 ALTEO Energiaszolgalta will offset losses from the drop in ALTEO Energiaszolgalta's long position.Infineon Technologies vs. OTP Bank Nyrt | Infineon Technologies vs. MOL Nyrt | Infineon Technologies vs. OPUS GLOBAL Nyrt | Infineon Technologies vs. ALTEO Energiaszolgaltato Nyrt |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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