Correlation Between Sartorius Stedim and Coloplast

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

By analyzing existing cross correlation between Sartorius Stedim Biotech and Coloplast AS, you can compare the effects of market volatilities on Sartorius Stedim and Coloplast 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 Sartorius Stedim with a short position of Coloplast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sartorius Stedim and Coloplast.

Diversification Opportunities for Sartorius Stedim and Coloplast

-0.22

Correlation Coefficient

Sartorius Stedim  Coloplast

Very good diversification

The 3 months correlation between Sartorius and Coloplast is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sartorius Stedim Biotech and Coloplast AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coloplast AS and Sartorius Stedim 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 Sartorius Stedim Biotech are associated (or correlated) with Coloplast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coloplast AS has no effect on the direction of Sartorius Stedim i.e., Sartorius Stedim and Coloplast go up and down completely randomly.

Pair Corralation between Sartorius Stedim and Coloplast

Assuming the 90 days horizon Sartorius Stedim Biotech is expected to under-perform the Coloplast. In addition to that, Sartorius Stedim is 1.24 times more volatile than Coloplast AS. It trades about -0.1 of its total potential returns per unit of risk. Coloplast AS is currently generating about -0.09 per unit of volatility. If you would invest  10,625  in Coloplast AS on May 6, 2025 and sell it today you would lose (1,366) from holding Coloplast AS or give up 12.86% of portfolio value over 90 days.

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

Sartorius Stedim Biotech  vs.  Coloplast AS

Sartorius Stedim Biotech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sartorius Stedim Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical indicators remain nearly stable which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Coloplast AS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Coloplast AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers 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 Sartorius Stedim and Coloplast

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

The idea behind Sartorius Stedim Biotech and Coloplast AS 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.