Correlation Between Oesterr Post and IShares ATX

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

By analyzing existing cross correlation between Oesterr Post AG and iShares ATX UCITS, you can compare the effects of market volatilities on Oesterr Post and IShares ATX 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 Oesterr Post with a short position of IShares ATX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oesterr Post and IShares ATX.

Diversification Opportunities for Oesterr Post and IShares ATX

0.94

Correlation Coefficient

Oesterr Post  IShares ATX

Almost no diversification

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

Pair Corralation between Oesterr Post and IShares ATX

Assuming the 90 days trading horizon Oesterr Post is expected to generate 1.48 times less return on investment than IShares ATX. But when comparing it to its historical volatility, Oesterr Post AG is 1.24 times less risky than IShares ATX. It trades about 0.23 of its potential returns per unit of risk. iShares ATX UCITS is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest  3,763  in iShares ATX UCITS on December 1, 2024 and sell it today you would earn a total of  630.00  from holding iShares ATX UCITS or generate 16.74% return on investment over 90 days.

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

Oesterr Post AG  vs.  iShares ATX UCITS

Oesterr Post AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Oesterr Post AG are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent forward indicators, Oesterr Post may actually be approaching a critical reversion point that can send shares even higher in April 2025.

iShares ATX UCITS

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in iShares ATX UCITS are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, IShares ATX demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Oesterr Post and IShares ATX

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

The idea behind Oesterr Post AG and iShares ATX UCITS 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.

Check out your portfolio center.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.