Correlation Between Metrospaces and S A P

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

By analyzing existing cross correlation between Metrospaces and SAP SE ADR, you can compare the effects of market volatilities on Metrospaces and S A P 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 Metrospaces with a short position of S A P. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metrospaces and S A P.

Diversification Opportunities for Metrospaces and S A P

-0.05

Correlation Coefficient

Metrospaces  S A P

Good diversification

The 3 months correlation between Metrospaces and SAP is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Metrospaces and SAP SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE ADR and Metrospaces 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 Metrospaces are associated (or correlated) with S A P. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE ADR has no effect on the direction of Metrospaces i.e., Metrospaces and S A P go up and down completely randomly.

Pair Corralation between Metrospaces and S A P

Given the investment horizon of 90 days Metrospaces is expected to generate 226.31 times more return on investment than S A P. However, Metrospaces is 226.31 times more volatile than SAP SE ADR. It trades about 0.31 of its potential returns per unit of risk. SAP SE ADR is currently generating about -0.11 per unit of risk. If you would invest  0.01  in Metrospaces on May 26, 2025 and sell it today you would earn a total of  0.00  from holding Metrospaces or generate 0.0% return on investment over 90 days.

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

Metrospaces  vs.  SAP SE ADR

Metrospaces

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Metrospaces are ranked lower than 24 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Metrospaces exhibited solid returns over the last few months and may actually be approaching a breakup point.

SAP SE ADR

Risk-Adjusted Performance

Weakest

Over the last 90 days SAP SE ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest conflicting performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Metrospaces and S A P

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

The idea behind Metrospaces and SAP SE ADR 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.