Correlation Between Vontobel Holding and Cembra Money

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

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

Diversification Opportunities for Vontobel Holding and Cembra Money

0.72

Correlation Coefficient

Vontobel Holding  Cembra Money

Poor diversification

The 3 months correlation between Vontobel and Cembra is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Vontobel Holding and Cembra Money Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cembra Money Bank and Vontobel Holding 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 Vontobel Holding are associated (or correlated) with Cembra Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cembra Money Bank has no effect on the direction of Vontobel Holding i.e., Vontobel Holding and Cembra Money go up and down completely randomly.

Pair Corralation between Vontobel Holding and Cembra Money

Assuming the 90 days trading horizon Vontobel Holding is expected to generate 0.97 times more return on investment than Cembra Money. However, Vontobel Holding is 1.03 times less risky than Cembra Money. It trades about 0.36 of its potential returns per unit of risk. Cembra Money Bank is currently generating about 0.11 per unit of risk. If you would invest  5,730  in Vontobel Holding on April 25, 2025 and sell it today you would earn a total of  1,130  from holding Vontobel Holding or generate 19.72% return on investment over 90 days.

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

Vontobel Holding  vs.  Cembra Money Bank

Vontobel Holding

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Vontobel Holding are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Vontobel Holding showed solid returns over the last few months and may actually be approaching a breakup point.

Cembra Money Bank

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cembra Money Bank are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Cembra Money 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 Vontobel Holding and Cembra Money

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

The idea behind Vontobel Holding and Cembra Money Bank 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..