Correlation Between Vontobel Holding and Barry Callebaut

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

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

Diversification Opportunities for Vontobel Holding and Barry Callebaut

-0.87

Correlation Coefficient

Vontobel Holding  Barry Callebaut

Pay attention - limited upside

The 3 months correlation between Vontobel and Barry is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Vontobel Holding and Barry Callebaut AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barry Callebaut AG and Vontobel Holding 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 Vontobel Holding are associated (or correlated) with Barry Callebaut. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barry Callebaut AG has no effect on the direction of Vontobel Holding i.e., Vontobel Holding and Barry Callebaut go up and down completely randomly.

Pair Corralation between Vontobel Holding and Barry Callebaut

Assuming the 90 days trading horizon Vontobel Holding is expected to generate 0.55 times more return on investment than Barry Callebaut. However, Vontobel Holding is 1.82 times less risky than Barry Callebaut. It trades about 0.13 of its potential returns per unit of risk. Barry Callebaut AG is currently generating about -0.11 per unit of risk. If you would invest  6,010  in Vontobel Holding on December 4, 2024 and sell it today you would earn a total of  460.00  from holding Vontobel Holding or generate 7.65% return on investment over 90 days.

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

Vontobel Holding  vs.  Barry Callebaut AG

Vontobel Holding

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Vontobel Holding are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Vontobel Holding may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Barry Callebaut AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Barry Callebaut AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Vontobel Holding and Barry Callebaut

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

The idea behind Vontobel Holding and Barry Callebaut AG 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.