Correlation Between Daetwyl I and SFS Group

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

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

Diversification Opportunities for Daetwyl I and SFS Group

0.29

Correlation Coefficient

Daetwyl I  SFS Group

Modest diversification

The 3 months correlation between Daetwyl and SFS is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Daetwyl I and SFS Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFS Group AG and Daetwyl I 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 Daetwyl I are associated (or correlated) with SFS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFS Group AG has no effect on the direction of Daetwyl I i.e., Daetwyl I and SFS Group go up and down completely randomly.

Pair Corralation between Daetwyl I and SFS Group

Assuming the 90 days trading horizon Daetwyl I is expected to generate 2.58 times more return on investment than SFS Group. However, Daetwyl I is 2.58 times more volatile than SFS Group AG. It trades about 0.15 of its potential returns per unit of risk. SFS Group AG is currently generating about 0.06 per unit of risk. If you would invest  11,380  in Daetwyl I on April 23, 2025 and sell it today you would earn a total of  3,320  from holding Daetwyl I or generate 29.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Daetwyl I  vs.  SFS Group AG

Daetwyl I

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Daetwyl I are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal technical and fundamental indicators, Daetwyl I showed solid returns over the last few months and may actually be approaching a breakup point.

SFS Group AG

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SFS Group AG are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, SFS Group is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Daetwyl I and SFS Group

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

The idea behind Daetwyl I and SFS Group 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 Global Correlations module to find global opportunities by holding instruments from different markets.