Correlation Between SSMTF and Aryzta AG

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

By analyzing existing cross correlation between SSMTF and Aryzta AG PK, you can compare the effects of market volatilities on SSMTF and Aryzta AG 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 SSMTF with a short position of Aryzta AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSMTF and Aryzta AG.

Diversification Opportunities for SSMTF and Aryzta AG

0.0

Correlation Coefficient

SSMTF  Aryzta AG

Pay attention - limited upside

The 3 months correlation between SSMTF and Aryzta is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SSMTF and Aryzta AG PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aryzta AG PK and SSMTF 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 SSMTF are associated (or correlated) with Aryzta AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aryzta AG PK has no effect on the direction of SSMTF i.e., SSMTF and Aryzta AG go up and down completely randomly.

Pair Corralation between SSMTF and Aryzta AG

If you would invest  83.00  in Aryzta AG PK on October 5, 2024 and sell it today you would earn a total of  3.00  from holding Aryzta AG PK or generate 3.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	90.0%
Values	Daily Returns

SSMTF  vs.  Aryzta AG PK

SSMTF

Risk-Adjusted Performance

0 of 100

Very Weak

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

Aryzta AG PK

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aryzta AG PK has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with SSMTF and Aryzta AG

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

The idea behind SSMTF and Aryzta AG PK 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..