Correlation Between Trustcash Holdings and Sartorius Aktiengesellscha

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

By analyzing existing cross correlation between Trustcash Holdings and Sartorius Aktiengesellschaft, you can compare the effects of market volatilities on Trustcash Holdings and Sartorius Aktiengesellscha 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 Trustcash Holdings with a short position of Sartorius Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trustcash Holdings and Sartorius Aktiengesellscha.

Diversification Opportunities for Trustcash Holdings and Sartorius Aktiengesellscha

0.65

Correlation Coefficient

Trustcash Holdings  Sartorius Aktiengesellscha

Poor diversification

The 3 months correlation between Trustcash and Sartorius is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Trustcash Holdings and Sartorius Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sartorius Aktiengesellscha and Trustcash Holdings 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 Trustcash Holdings are associated (or correlated) with Sartorius Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sartorius Aktiengesellscha has no effect on the direction of Trustcash Holdings i.e., Trustcash Holdings and Sartorius Aktiengesellscha go up and down completely randomly.

Pair Corralation between Trustcash Holdings and Sartorius Aktiengesellscha

Given the investment horizon of 90 days Trustcash Holdings is expected to under-perform the Sartorius Aktiengesellscha. In addition to that, Trustcash Holdings is 5.44 times more volatile than Sartorius Aktiengesellschaft. It trades about -0.13 of its total potential returns per unit of risk. Sartorius Aktiengesellschaft is currently generating about -0.05 per unit of volatility. If you would invest  20,547  in Sartorius Aktiengesellschaft on October 14, 2024 and sell it today you would lose (1,717) from holding Sartorius Aktiengesellschaft or give up 8.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.31%
Values	Daily Returns

Trustcash Holdings  vs.  Sartorius Aktiengesellschaft

Trustcash Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trustcash Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Sartorius Aktiengesellscha

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sartorius Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Trustcash Holdings and Sartorius Aktiengesellscha

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

The idea behind Trustcash Holdings and Sartorius Aktiengesellschaft 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.