Correlation Between VAT Group and Georg Fischer

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

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

Diversification Opportunities for VAT Group and Georg Fischer

0.8

Correlation Coefficient

VAT Group  Georg Fischer

Very poor diversification

The 3 months correlation between VAT and Georg is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding VAT Group AG and Georg Fischer AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Georg Fischer AG and VAT Group 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 VAT Group AG are associated (or correlated) with Georg Fischer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Georg Fischer AG has no effect on the direction of VAT Group i.e., VAT Group and Georg Fischer go up and down completely randomly.

Pair Corralation between VAT Group and Georg Fischer

Assuming the 90 days trading horizon VAT Group AG is expected to generate 1.38 times more return on investment than Georg Fischer. However, VAT Group is 1.38 times more volatile than Georg Fischer AG. It trades about 0.21 of its potential returns per unit of risk. Georg Fischer AG is currently generating about 0.13 per unit of risk. If you would invest  26,593  in VAT Group AG on April 22, 2025 and sell it today you would earn a total of  7,397  from holding VAT Group AG or generate 27.82% return on investment over 90 days.

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

VAT Group AG  vs.  Georg Fischer AG

VAT Group AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in VAT Group AG are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, VAT Group showed solid returns over the last few months and may actually be approaching a breakup point.

Georg Fischer AG

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Georg Fischer AG are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Georg Fischer may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with VAT Group and Georg Fischer

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

The idea behind VAT Group AG and Georg Fischer 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.