Correlation Between Infineon Technologies and Budapesti Ingatlan

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

Diversification Opportunities for Infineon Technologies and Budapesti Ingatlan

0.76

Correlation Coefficient

Infineon Technologies  Budapesti Ingatlan

Poor diversification

The 3 months correlation between Infineon and Budapesti is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Infineon Technologies AG and Budapesti Ingatlan Hasznositas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Budapesti Ingatlan 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 Budapesti Ingatlan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Budapesti Ingatlan has no effect on the direction of Infineon Technologies i.e., Infineon Technologies and Budapesti Ingatlan go up and down completely randomly.

Pair Corralation between Infineon Technologies and Budapesti Ingatlan

Assuming the 90 days trading horizon Infineon Technologies AG is expected to generate 1.9 times more return on investment than Budapesti Ingatlan. However, Infineon Technologies is 1.9 times more volatile than Budapesti Ingatlan Hasznositasi. It trades about 0.05 of its potential returns per unit of risk. Budapesti Ingatlan Hasznositasi 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 Together
Strength	Significant
Accuracy	72.41%
Values	Daily Returns

Infineon Technologies AG  vs.  Budapesti Ingatlan Hasznositas

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.

Budapesti Ingatlan

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Budapesti Ingatlan Hasznositasi are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Budapesti Ingatlan 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 Budapesti Ingatlan

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

The idea behind Infineon Technologies AG and Budapesti Ingatlan Hasznositasi 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..