Correlation Between Mikron Holding and Also Holding

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

By analyzing existing cross correlation between Mikron Holding AG and Also Holding AG, you can compare the effects of market volatilities on Mikron Holding and Also Holding 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 Mikron Holding with a short position of Also Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mikron Holding and Also Holding.

Diversification Opportunities for Mikron Holding and Also Holding

0.94

Correlation Coefficient

Mikron Holding  Also Holding

Almost no diversification

The 3 months correlation between Mikron and Also is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Mikron Holding AG and Also Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Also Holding AG and Mikron Holding 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 Mikron Holding AG are associated (or correlated) with Also Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Also Holding AG has no effect on the direction of Mikron Holding i.e., Mikron Holding and Also Holding go up and down completely randomly.

Pair Corralation between Mikron Holding and Also Holding

Assuming the 90 days trading horizon Mikron Holding AG is expected to under-perform the Also Holding. In addition to that, Mikron Holding is 1.98 times more volatile than Also Holding AG. It trades about -0.13 of its total potential returns per unit of risk. Also Holding AG is currently generating about -0.22 per unit of volatility. If you would invest  26,300  in Also Holding AG on October 3, 2024 and sell it today you would lose (3,900) from holding Also Holding AG or give up 14.83% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Mikron Holding AG  vs.  Also Holding AG

Mikron Holding AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mikron Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Also Holding AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Also Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Mikron Holding and Also Holding

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

The idea behind Mikron Holding AG and Also Holding AG 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.