Correlation Between Siemens Energy and Icahn Enterprises

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

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

Diversification Opportunities for Siemens Energy and Icahn Enterprises

0.29

Correlation Coefficient

Siemens Energy  Icahn Enterprises

Modest diversification

The 3 months correlation between Siemens and Icahn is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Siemens Energy AG and Icahn Enterprises LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icahn Enterprises and Siemens Energy 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 Siemens Energy AG are associated (or correlated) with Icahn Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icahn Enterprises has no effect on the direction of Siemens Energy i.e., Siemens Energy and Icahn Enterprises go up and down completely randomly.

Pair Corralation between Siemens Energy and Icahn Enterprises

Assuming the 90 days horizon Siemens Energy AG is expected to generate 1.11 times more return on investment than Icahn Enterprises. However, Siemens Energy is 1.11 times more volatile than Icahn Enterprises LP. It trades about 0.24 of its potential returns per unit of risk. Icahn Enterprises LP is currently generating about 0.1 per unit of risk. If you would invest  8,212  in Siemens Energy AG on May 7, 2025 and sell it today you would earn a total of  3,307  from holding Siemens Energy AG or generate 40.27% return on investment over 90 days.

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

Siemens Energy AG  vs.  Icahn Enterprises LP

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 19 (%) 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.

Icahn Enterprises

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Icahn Enterprises LP are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting technical and fundamental indicators, Icahn Enterprises reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Siemens Energy and Icahn Enterprises

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

The idea behind Siemens Energy AG and Icahn Enterprises LP 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.