Correlation Between Siemens AG and Greenland Acquisition
Can any of the company-specific risk be diversified away by investing in both Siemens AG and Greenland Acquisition 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 Siemens AG and Greenland Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siemens AG Class and Greenland Acquisition Corp, you can compare the effects of market volatilities on Siemens AG and Greenland Acquisition 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 Siemens AG with a short position of Greenland Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siemens AG and Greenland Acquisition.
Diversification Opportunities for Siemens AG and Greenland Acquisition
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siemens and Greenland is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Siemens AG Class and Greenland Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenland Acquisition and Siemens AG 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 Siemens AG Class are associated (or correlated) with Greenland Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenland Acquisition has no effect on the direction of Siemens AG i.e., Siemens AG and Greenland Acquisition go up and down completely randomly.
Pair Corralation between Siemens AG and Greenland Acquisition
Assuming the 90 days horizon Siemens AG is expected to generate 1.56 times less return on investment than Greenland Acquisition. But when comparing it to its historical volatility, Siemens AG Class is 3.31 times less risky than Greenland Acquisition. It trades about 0.05 of its potential returns per unit of risk. Greenland Acquisition Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 217.00 in Greenland Acquisition Corp on September 26, 2024 and sell it today you would lose (23.00) from holding Greenland Acquisition Corp or give up 10.6% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Siemens AG Class vs. Greenland Acquisition Corp
Performance |
Timeline |
Siemens AG Class |
Greenland Acquisition |
Siemens AG and Greenland Acquisition Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Siemens AG and Greenland Acquisition
The main advantage of trading using opposite Siemens AG and Greenland Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siemens AG position performs unexpectedly, Greenland Acquisition 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 Greenland Acquisition will offset losses from the drop in Greenland Acquisition's long position.Siemens AG vs. Shapeways Holdings, Common | Siemens AG vs. JE Cleantech Holdings | Siemens AG vs. Greenland Acquisition Corp | Siemens AG vs. Laser Photonics |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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