Correlation Between Schweiter Technologies and Cicor Technologies

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

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

Diversification Opportunities for Schweiter Technologies and Cicor Technologies

-0.04

Correlation Coefficient

Schweiter Technologies  Cicor Technologies

Good diversification

The 3 months correlation between Schweiter and Cicor is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Schweiter Technologies AG and Cicor Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cicor Technologies and Schweiter Technologies 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 Schweiter Technologies AG are associated (or correlated) with Cicor Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cicor Technologies has no effect on the direction of Schweiter Technologies i.e., Schweiter Technologies and Cicor Technologies go up and down completely randomly.

Pair Corralation between Schweiter Technologies and Cicor Technologies

Assuming the 90 days trading horizon Schweiter Technologies AG is expected to under-perform the Cicor Technologies. In addition to that, Schweiter Technologies is 1.52 times more volatile than Cicor Technologies. It trades about -0.06 of its total potential returns per unit of risk. Cicor Technologies is currently generating about 0.04 per unit of volatility. If you would invest  4,730  in Cicor Technologies on September 28, 2024 and sell it today you would earn a total of  890.00  from holding Cicor Technologies or generate 18.82% return on investment over 90 days.

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

Schweiter Technologies AG  vs.  Cicor Technologies

Schweiter Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Schweiter Technologies AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Schweiter Technologies is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Cicor Technologies

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cicor Technologies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Cicor Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Schweiter Technologies and Cicor Technologies

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

The idea behind Schweiter Technologies AG and Cicor Technologies 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.