Correlation Between HENSOLDT and Advanced Micro

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

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

Diversification Opportunities for HENSOLDT and Advanced Micro

0.59

Correlation Coefficient

HENSOLDT  Advanced Micro

Very weak diversification

The 3 months correlation between HENSOLDT and Advanced is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding HENSOLDT AG UNSP and Advanced Micro Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Micro Devices and HENSOLDT 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 HENSOLDT AG UNSP are associated (or correlated) with Advanced Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Micro Devices has no effect on the direction of HENSOLDT i.e., HENSOLDT and Advanced Micro go up and down completely randomly.

Pair Corralation between HENSOLDT and Advanced Micro

Assuming the 90 days trading horizon HENSOLDT AG UNSP is expected to generate 1.38 times more return on investment than Advanced Micro. However, HENSOLDT is 1.38 times more volatile than Advanced Micro Devices. It trades about 0.21 of its potential returns per unit of risk. Advanced Micro Devices is currently generating about 0.28 per unit of risk. If you would invest  3,124  in HENSOLDT AG UNSP on April 25, 2025 and sell it today you would earn a total of  1,856  from holding HENSOLDT AG UNSP or generate 59.41% return on investment over 90 days.

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

HENSOLDT AG UNSP  vs.  Advanced Micro Devices

HENSOLDT AG UNSP

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in HENSOLDT AG UNSP are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical and fundamental indicators, HENSOLDT reported solid returns over the last few months and may actually be approaching a breakup point.

Advanced Micro Devices

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Advanced Micro Devices are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Advanced Micro reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HENSOLDT and Advanced Micro

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

The idea behind HENSOLDT AG UNSP and Advanced Micro Devices 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.