Correlation Between Sixt Leasing and Cboe Global

Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and Cboe Global 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 Sixt Leasing and Cboe Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sixt Leasing SE and Cboe Global Markets, you can compare the effects of market volatilities on Sixt Leasing and Cboe Global 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 Sixt Leasing with a short position of Cboe Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and Cboe Global.

Diversification Opportunities for Sixt Leasing and Cboe Global

-0.04

Correlation Coefficient

Sixt Leasing  Cboe Global

Good diversification

The 3 months correlation between Sixt and Cboe is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Cboe Global Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cboe Global Markets and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Cboe Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cboe Global Markets has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Cboe Global go up and down completely randomly.

Pair Corralation between Sixt Leasing and Cboe Global

Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the Cboe Global. In addition to that, Sixt Leasing is 1.03 times more volatile than Cboe Global Markets. It trades about -0.07 of its total potential returns per unit of risk. Cboe Global Markets is currently generating about -0.03 per unit of volatility. If you would invest  19,531  in Cboe Global Markets on October 26, 2024 and sell it today you would lose (666.00) from holding Cboe Global Markets or give up 3.41% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Sixt Leasing SE  vs.  Cboe Global Markets

Sixt Leasing SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sixt Leasing SE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Cboe Global Markets

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cboe Global Markets has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Cboe Global is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Sixt Leasing and Cboe Global

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

The idea behind Sixt Leasing SE and Cboe Global Markets 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.