Correlation Between OC Oerlikon and Schindler Holding

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

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

Diversification Opportunities for OC Oerlikon and Schindler Holding

0.9

Correlation Coefficient

OC Oerlikon  Schindler Holding

Almost no diversification

The 3 months correlation between OERL and Schindler is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding OC Oerlikon Corp and Schindler Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schindler Holding and OC Oerlikon 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 OC Oerlikon Corp are associated (or correlated) with Schindler Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schindler Holding has no effect on the direction of OC Oerlikon i.e., OC Oerlikon and Schindler Holding go up and down completely randomly.

Pair Corralation between OC Oerlikon and Schindler Holding

Assuming the 90 days trading horizon OC Oerlikon Corp is expected to generate 2.07 times more return on investment than Schindler Holding. However, OC Oerlikon is 2.07 times more volatile than Schindler Holding AG. It trades about 0.16 of its potential returns per unit of risk. Schindler Holding AG is currently generating about 0.17 per unit of risk. If you would invest  351.00  in OC Oerlikon Corp on December 30, 2024 and sell it today you would earn a total of  72.00  from holding OC Oerlikon Corp or generate 20.51% return on investment over 90 days.

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

OC Oerlikon Corp  vs.  Schindler Holding AG

OC Oerlikon Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in OC Oerlikon Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, OC Oerlikon showed solid returns over the last few months and may actually be approaching a breakup point.

Schindler Holding

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Schindler Holding AG are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Schindler Holding may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with OC Oerlikon and Schindler Holding

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

The idea behind OC Oerlikon Corp and Schindler 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.