Correlation Between Ringmetall and Pets At

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

By analyzing existing cross correlation between Ringmetall SE and Pets at Home, you can compare the effects of market volatilities on Ringmetall and Pets At 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 Pets At. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ringmetall and Pets At.

Diversification Opportunities for Ringmetall and Pets At

-0.09

Correlation Coefficient

Ringmetall  Pets At

Good diversification

The 3 months correlation between Ringmetall and Pets is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Ringmetall SE and Pets at Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pets at Home 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 Pets At. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pets at Home has no effect on the direction of Ringmetall i.e., Ringmetall and Pets At go up and down completely randomly.

Pair Corralation between Ringmetall and Pets At

Assuming the 90 days trading horizon Ringmetall SE is expected to generate 1.86 times more return on investment than Pets At. However, Ringmetall is 1.86 times more volatile than Pets at Home. It trades about 0.01 of its potential returns per unit of risk. Pets at Home is currently generating about -0.08 per unit of risk. If you would invest  308.00  in Ringmetall SE on May 6, 2025 and sell it today you would lose (4.00) from holding Ringmetall SE or give up 1.3% of portfolio value over 90 days.

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

Ringmetall SE  vs.  Pets at Home

Ringmetall SE

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ringmetall SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ringmetall is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pets at Home

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pets at Home has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Ringmetall and Pets At

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

The idea behind Ringmetall SE and Pets at Home 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.