Correlation Between St Galler and LandisGyr Group
Can any of the company-specific risk be diversified away by investing in both St Galler and LandisGyr Group 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 St Galler and LandisGyr Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between St Galler Kantonalbank and LandisGyr Group AG, you can compare the effects of market volatilities on St Galler and LandisGyr Group 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 St Galler with a short position of LandisGyr Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of St Galler and LandisGyr Group.
Diversification Opportunities for St Galler and LandisGyr Group
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SGKN and LandisGyr is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding St Galler Kantonalbank and LandisGyr Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LandisGyr Group AG and St Galler 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 St Galler Kantonalbank are associated (or correlated) with LandisGyr Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LandisGyr Group AG has no effect on the direction of St Galler i.e., St Galler and LandisGyr Group go up and down completely randomly.
Pair Corralation between St Galler and LandisGyr Group
Assuming the 90 days trading horizon St Galler Kantonalbank is expected to generate 0.36 times more return on investment than LandisGyr Group. However, St Galler Kantonalbank is 2.76 times less risky than LandisGyr Group. It trades about 0.14 of its potential returns per unit of risk. LandisGyr Group AG is currently generating about -0.14 per unit of risk. If you would invest 42,850 in St Galler Kantonalbank on October 23, 2024 and sell it today you would earn a total of 2,350 from holding St Galler Kantonalbank or generate 5.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
St Galler Kantonalbank vs. LandisGyr Group AG
Performance |
Timeline |
St Galler Kantonalbank |
LandisGyr Group AG |
St Galler and LandisGyr Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with St Galler and LandisGyr Group
The main advantage of trading using opposite St Galler and LandisGyr Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if St Galler position performs unexpectedly, LandisGyr Group 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 LandisGyr Group will offset losses from the drop in LandisGyr Group's long position.St Galler vs. Banque Cantonale | St Galler vs. Luzerner Kantonalbank AG | St Galler vs. Berner Kantonalbank AG | St Galler vs. Helvetia Holding AG |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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