Correlation Between Ringmetall and SERI INDUSTRIAL

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

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

Diversification Opportunities for Ringmetall and SERI INDUSTRIAL

-0.27

Correlation Coefficient

Ringmetall  SERI INDUSTRIAL

Very good diversification

The 3 months correlation between Ringmetall and SERI is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ringmetall SE and SERI INDUSTRIAL EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SERI INDUSTRIAL EO and Ringmetall 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 Ringmetall SE are associated (or correlated) with SERI INDUSTRIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SERI INDUSTRIAL EO has no effect on the direction of Ringmetall i.e., Ringmetall and SERI INDUSTRIAL go up and down completely randomly.

Pair Corralation between Ringmetall and SERI INDUSTRIAL

Assuming the 90 days trading horizon Ringmetall is expected to generate 1.02 times less return on investment than SERI INDUSTRIAL. But when comparing it to its historical volatility, Ringmetall SE is 1.37 times less risky than SERI INDUSTRIAL. It trades about 0.06 of its potential returns per unit of risk. SERI INDUSTRIAL EO is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  195.00  in SERI INDUSTRIAL EO on April 24, 2025 and sell it today you would earn a total of  12.00  from holding SERI INDUSTRIAL EO or generate 6.15% return on investment over 90 days.

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

Ringmetall SE  vs.  SERI INDUSTRIAL EO

Ringmetall SE

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ringmetall SE are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Ringmetall may actually be approaching a critical reversion point that can send shares even higher in August 2025.

SERI INDUSTRIAL EO

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SERI INDUSTRIAL EO are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, SERI INDUSTRIAL may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Ringmetall and SERI INDUSTRIAL

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

The idea behind Ringmetall SE and SERI INDUSTRIAL EO 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.