Correlation Between Infineon Technologies and ANY Security

Can any of the company-specific risk be diversified away by investing in both Infineon Technologies and ANY Security 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 ANY Security 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 ANY Security Printing, you can compare the effects of market volatilities on Infineon Technologies and ANY Security 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 ANY Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infineon Technologies and ANY Security.

Diversification Opportunities for Infineon Technologies and ANY Security

0.01

Correlation Coefficient

Infineon Technologies  ANY Security

Significant diversification

The 3 months correlation between Infineon and ANY is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Infineon Technologies AG and ANY Security Printing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANY Security Printing 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 ANY Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANY Security Printing has no effect on the direction of Infineon Technologies i.e., Infineon Technologies and ANY Security go up and down completely randomly.

Pair Corralation between Infineon Technologies and ANY Security

Assuming the 90 days trading horizon Infineon Technologies AG is expected to generate 1.5 times more return on investment than ANY Security. However, Infineon Technologies is 1.5 times more volatile than ANY Security Printing. It trades about 0.38 of its potential returns per unit of risk. ANY Security Printing is currently generating about 0.05 per unit of risk. If you would invest  1,242,000  in Infineon Technologies AG on September 14, 2024 and sell it today you would earn a total of  131,000  from holding Infineon Technologies AG or generate 10.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	54.55%
Values	Daily Returns

Infineon Technologies AG  vs.  ANY Security Printing

Infineon Technologies

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Infineon Technologies AG are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady technical and fundamental indicators, Infineon Technologies sustained solid returns over the last few months and may actually be approaching a breakup point.

ANY Security Printing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ANY Security Printing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, ANY Security is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Infineon Technologies and ANY Security

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

The idea behind Infineon Technologies AG and ANY Security Printing 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.