Correlation Between RATH Aktiengesellscha and AT S

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

By analyzing existing cross correlation between RATH Aktiengesellschaft and AT S Austria, you can compare the effects of market volatilities on RATH Aktiengesellscha and AT S 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 RATH Aktiengesellscha with a short position of AT S. Check out your portfolio center. Please also check ongoing floating volatility patterns of RATH Aktiengesellscha and AT S.

Diversification Opportunities for RATH Aktiengesellscha and AT S

-0.32

Correlation Coefficient

RATH Aktiengesellscha  AT S

Very good diversification

The 3 months correlation between RATH and ATS is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding RATH Aktiengesellschaft and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and RATH Aktiengesellscha 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 RATH Aktiengesellschaft are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of RATH Aktiengesellscha i.e., RATH Aktiengesellscha and AT S go up and down completely randomly.

Pair Corralation between RATH Aktiengesellscha and AT S

Assuming the 90 days trading horizon RATH Aktiengesellschaft is expected to under-perform the AT S. But the stock apears to be less risky and, when comparing its historical volatility, RATH Aktiengesellschaft is 5.32 times less risky than AT S. The stock trades about -0.09 of its potential returns per unit of risk. The AT S Austria is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  1,175  in AT S Austria on December 25, 2024 and sell it today you would earn a total of  225.00  from holding AT S Austria or generate 19.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

RATH Aktiengesellschaft  vs.  AT S Austria

RATH Aktiengesellschaft

Risk-Adjusted Performance

Very Weak

Over the last 90 days RATH Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, RATH Aktiengesellscha is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

AT S Austria

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AT S Austria are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, AT S demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with RATH Aktiengesellscha and AT S

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

The idea behind RATH Aktiengesellschaft and AT S Austria 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.