Correlation Between Daifuku and Siemens Energy

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

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

Diversification Opportunities for Daifuku and Siemens Energy

-0.21

Correlation Coefficient

Daifuku  Siemens Energy

Very good diversification

The 3 months correlation between Daifuku and Siemens is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Daifuku Co and Siemens Energy AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Energy AG and Daifuku 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 Daifuku Co are associated (or correlated) with Siemens Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Energy AG has no effect on the direction of Daifuku i.e., Daifuku and Siemens Energy go up and down completely randomly.

Pair Corralation between Daifuku and Siemens Energy

Assuming the 90 days horizon Daifuku Co is expected to under-perform the Siemens Energy. But the pink sheet apears to be less risky and, when comparing its historical volatility, Daifuku Co is 1.07 times less risky than Siemens Energy. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Siemens Energy AG is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  8,280  in Siemens Energy AG on May 8, 2025 and sell it today you would earn a total of  3,110  from holding Siemens Energy AG or generate 37.56% return on investment over 90 days.

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

Daifuku Co  vs.  Siemens Energy AG

Daifuku

Risk-Adjusted Performance

Weakest

Over the last 90 days Daifuku Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, Daifuku is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Siemens Energy AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Siemens Energy AG are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Siemens Energy showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Daifuku and Siemens Energy

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

The idea behind Daifuku Co and Siemens Energy 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.