Correlation Between Geberit AG and Emmi AG

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

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

Diversification Opportunities for Geberit AG and Emmi AG

0.2

Correlation Coefficient

Geberit AG  Emmi AG

Modest diversification

The 3 months correlation between Geberit and Emmi is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Geberit AG and Emmi AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emmi AG and Geberit AG 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 Geberit AG are associated (or correlated) with Emmi AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emmi AG has no effect on the direction of Geberit AG i.e., Geberit AG and Emmi AG go up and down completely randomly.

Pair Corralation between Geberit AG and Emmi AG

Assuming the 90 days trading horizon Geberit AG is expected to generate 1.07 times more return on investment than Emmi AG. However, Geberit AG is 1.07 times more volatile than Emmi AG. It trades about 0.19 of its potential returns per unit of risk. Emmi AG is currently generating about -0.06 per unit of risk. If you would invest  54,580  in Geberit AG on April 23, 2025 and sell it today you would earn a total of  6,780  from holding Geberit AG or generate 12.42% return on investment over 90 days.

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

Geberit AG  vs.  Emmi AG

Geberit AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Geberit AG are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Geberit AG may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Emmi AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Emmi AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Emmi AG 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 Geberit AG and Emmi AG

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

The idea behind Geberit AG and Emmi 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.

Check out your portfolio center.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.