Correlation Between Traton SE and Cinis Fertilizer

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

By analyzing existing cross correlation between Traton SE and Cinis Fertilizer AB, you can compare the effects of market volatilities on Traton SE and Cinis Fertilizer 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 Traton SE with a short position of Cinis Fertilizer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Traton SE and Cinis Fertilizer.

Diversification Opportunities for Traton SE and Cinis Fertilizer

-0.65

Correlation Coefficient

Traton SE  Cinis Fertilizer

Excellent diversification

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

Pair Corralation between Traton SE and Cinis Fertilizer

Assuming the 90 days trading horizon Traton SE is expected to generate 0.25 times more return on investment than Cinis Fertilizer. However, Traton SE is 4.06 times less risky than Cinis Fertilizer. It trades about 0.18 of its potential returns per unit of risk. Cinis Fertilizer AB is currently generating about -0.1 per unit of risk. If you would invest  28,747  in Traton SE on April 24, 2025 and sell it today you would earn a total of  7,593  from holding Traton SE or generate 26.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Traton SE  vs.  Cinis Fertilizer AB

Traton SE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Traton SE are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Traton SE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Cinis Fertilizer

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cinis Fertilizer AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Traton SE and Cinis Fertilizer

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

The idea behind Traton SE and Cinis Fertilizer AB 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..