Correlation Between AdCapital and FRESENIUS SECO

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

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

Diversification Opportunities for AdCapital and FRESENIUS SECO

-0.72

Correlation Coefficient

AdCapital  FRESENIUS SECO

Pay attention - limited upside

The 3 months correlation between AdCapital and FRESENIUS is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding AdCapital AG and FRESENIUS SECO ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRESENIUS SECO ADR and AdCapital 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 AdCapital AG are associated (or correlated) with FRESENIUS SECO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRESENIUS SECO ADR has no effect on the direction of AdCapital i.e., AdCapital and FRESENIUS SECO go up and down completely randomly.

Pair Corralation between AdCapital and FRESENIUS SECO

Assuming the 90 days horizon AdCapital AG is expected to generate 1.94 times more return on investment than FRESENIUS SECO. However, AdCapital is 1.94 times more volatile than FRESENIUS SECO ADR. It trades about 0.03 of its potential returns per unit of risk. FRESENIUS SECO ADR is currently generating about 0.05 per unit of risk. If you would invest  127.00  in AdCapital AG on April 24, 2025 and sell it today you would earn a total of  29.00  from holding AdCapital AG or generate 22.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

AdCapital AG  vs.  FRESENIUS SECO ADR

AdCapital AG

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AdCapital AG are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, AdCapital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

FRESENIUS SECO ADR

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FRESENIUS SECO ADR are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, FRESENIUS SECO is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with AdCapital and FRESENIUS SECO

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

The idea behind AdCapital AG and FRESENIUS SECO ADR 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.