Correlation Between Sulzer AG and Swissquote Group

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Sulzer AG and Swissquote 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 Sulzer AG and Swissquote Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sulzer AG and Swissquote Group Holding, you can compare the effects of market volatilities on Sulzer AG and Swissquote 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 Sulzer AG with a short position of Swissquote Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sulzer AG and Swissquote Group.

Diversification Opportunities for Sulzer AG and Swissquote Group

SulzerSwissquoteDiversified AwaySulzerSwissquoteDiversified Away100%
0.16
  Correlation Coefficient

Average diversification

The 3 months correlation between Sulzer and Swissquote is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sulzer AG and Swissquote Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swissquote Group Holding and Sulzer 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 Sulzer AG are associated (or correlated) with Swissquote Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swissquote Group Holding has no effect on the direction of Sulzer AG i.e., Sulzer AG and Swissquote Group go up and down completely randomly.

Pair Corralation between Sulzer AG and Swissquote Group

Assuming the 90 days trading horizon Sulzer AG is expected to generate 3.58 times less return on investment than Swissquote Group. In addition to that, Sulzer AG is 1.04 times more volatile than Swissquote Group Holding. It trades about 0.05 of its total potential returns per unit of risk. Swissquote Group Holding is currently generating about 0.19 per unit of volatility. If you would invest  28,800  in Swissquote Group Holding on September 4, 2024 and sell it today you would earn a total of  6,420  from holding Swissquote Group Holding or generate 22.29% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Sulzer AG  vs.  Swissquote Group Holding

 Performance 
JavaScript chart by amCharts 3.21.15SepOctNov -50510
JavaScript chart by amCharts 3.21.15SUN SQN
       Timeline  
Sulzer AG 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Sulzer AG are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Sulzer AG is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec125130135140145
Swissquote Group Holding 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Swissquote Group Holding are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Swissquote Group showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec280290300310320330340350

Sulzer AG and Swissquote Group Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.52-4.13-2.75-1.360.01.332.734.135.536.94 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15SUN SQN
       Returns  

Pair Trading with Sulzer AG and Swissquote Group

The main advantage of trading using opposite Sulzer AG and Swissquote Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sulzer AG position performs unexpectedly, Swissquote 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 Swissquote Group will offset losses from the drop in Swissquote Group's long position.
The idea behind Sulzer AG and Swissquote Group Holding 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.

Other Complementary Tools

ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios