Correlation Between Orix Corp and Fielmann Aktiengesellscha

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

Diversification Opportunities for Orix Corp and Fielmann Aktiengesellscha

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Orix and Fielmann is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Orix Corp Ads and Fielmann Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fielmann Aktiengesellscha and Orix Corp 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 Orix Corp Ads are associated (or correlated) with Fielmann Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fielmann Aktiengesellscha has no effect on the direction of Orix Corp i.e., Orix Corp and Fielmann Aktiengesellscha go up and down completely randomly.

Pair Corralation between Orix Corp and Fielmann Aktiengesellscha

Assuming the 90 days trading horizon Orix Corp Ads is expected to generate 1.14 times more return on investment than Fielmann Aktiengesellscha. However, Orix Corp is 1.14 times more volatile than Fielmann Aktiengesellschaft. It trades about -0.02 of its potential returns per unit of risk. Fielmann Aktiengesellschaft is currently generating about -0.06 per unit of risk. If you would invest  10,000  in Orix Corp Ads on September 19, 2024 and sell it today you would lose (100.00) from holding Orix Corp Ads or give up 1.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy95.65%
ValuesDaily Returns

Orix Corp Ads  vs.  Fielmann Aktiengesellschaft

 Performance 
       Timeline  
Orix Corp Ads 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Orix Corp Ads has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Orix Corp is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
Fielmann Aktiengesellscha 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Fielmann Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Orix Corp and Fielmann Aktiengesellscha Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Orix Corp and Fielmann Aktiengesellscha

The main advantage of trading using opposite Orix Corp and Fielmann Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orix Corp position performs unexpectedly, Fielmann Aktiengesellscha 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 Fielmann Aktiengesellscha will offset losses from the drop in Fielmann Aktiengesellscha's long position.
The idea behind Orix Corp Ads and Fielmann Aktiengesellschaft 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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