Correlation Between Metall Zug and Schindler

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

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

Diversification Opportunities for Metall Zug and Schindler

0.75

Correlation Coefficient

Metall Zug  Schindler

Poor diversification

The 3 months correlation between Metall and Schindler is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Metall Zug AG and Schindler Ps in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schindler Ps and Metall Zug 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 Metall Zug AG are associated (or correlated) with Schindler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schindler Ps has no effect on the direction of Metall Zug i.e., Metall Zug and Schindler go up and down completely randomly.

Pair Corralation between Metall Zug and Schindler

Assuming the 90 days trading horizon Metall Zug is expected to generate 2.28 times less return on investment than Schindler. But when comparing it to its historical volatility, Metall Zug AG is 1.5 times less risky than Schindler. It trades about 0.07 of its potential returns per unit of risk. Schindler Ps is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  27,300  in Schindler Ps on April 23, 2025 and sell it today you would earn a total of  2,740  from holding Schindler Ps or generate 10.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

Metall Zug AG  vs.  Schindler Ps

Metall Zug AG

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Metall Zug AG are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Metall Zug is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Schindler Ps

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Schindler Ps are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Schindler may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Metall Zug and Schindler

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

The idea behind Metall Zug AG and Schindler Ps 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.