Correlation Between INTERSHOP Communications and Data#3

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Can any of the company-specific risk be diversified away by investing in both INTERSHOP Communications and Data#3 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 INTERSHOP Communications and Data#3 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTERSHOP Communications Aktiengesellschaft and Data3 Limited, you can compare the effects of market volatilities on INTERSHOP Communications and Data#3 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 INTERSHOP Communications with a short position of Data#3. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTERSHOP Communications and Data#3.

Diversification Opportunities for INTERSHOP Communications and Data#3

INTERSHOPData#3Diversified AwayINTERSHOPData#3Diversified Away100%
0.46
  Correlation Coefficient

Very weak diversification

The 3 months correlation between INTERSHOP and Data#3 is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding INTERSHOP Communications Aktie and Data3 Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data3 Limited and INTERSHOP Communications 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 INTERSHOP Communications Aktiengesellschaft are associated (or correlated) with Data#3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data3 Limited has no effect on the direction of INTERSHOP Communications i.e., INTERSHOP Communications and Data#3 go up and down completely randomly.

Pair Corralation between INTERSHOP Communications and Data#3

Assuming the 90 days trading horizon INTERSHOP Communications Aktiengesellschaft is expected to generate 0.85 times more return on investment than Data#3. However, INTERSHOP Communications Aktiengesellschaft is 1.18 times less risky than Data#3. It trades about 0.03 of its potential returns per unit of risk. Data3 Limited is currently generating about -0.11 per unit of risk. If you would invest  173.00  in INTERSHOP Communications Aktiengesellschaft on October 20, 2024 and sell it today you would earn a total of  5.00  from holding INTERSHOP Communications Aktiengesellschaft or generate 2.89% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

INTERSHOP Communications Aktie  vs.  Data3 Limited

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -1001020
JavaScript chart by amCharts 3.21.15ISHA 20Y
       Timeline  
INTERSHOP Communications 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in INTERSHOP Communications Aktiengesellschaft are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, INTERSHOP Communications is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan1.651.71.751.81.851.91.952
Data3 Limited 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Data3 Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan3.63.844.24.44.64.8

INTERSHOP Communications and Data#3 Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.94-5.2-3.46-1.710.01.773.585.387.18 0.020.030.040.050.060.070.08
JavaScript chart by amCharts 3.21.15ISHA 20Y
       Returns  

Pair Trading with INTERSHOP Communications and Data#3

The main advantage of trading using opposite INTERSHOP Communications and Data#3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTERSHOP Communications position performs unexpectedly, Data#3 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 Data#3 will offset losses from the drop in Data#3's long position.
The idea behind INTERSHOP Communications Aktiengesellschaft and Data3 Limited 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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