Correlation Between Credit Suisse and Simplify Managed

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

By analyzing existing cross correlation between Credit Suisse X Links and Simplify Managed Futures, you can compare the effects of market volatilities on Credit Suisse and Simplify Managed 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 Credit Suisse with a short position of Simplify Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and Simplify Managed.

Diversification Opportunities for Credit Suisse and Simplify Managed

0.41

Correlation Coefficient

Credit Suisse  Simplify Managed

Very weak diversification

The 3 months correlation between Credit and Simplify is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse X Links and Simplify Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simplify Managed Futures and Credit Suisse 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 Credit Suisse X Links are associated (or correlated) with Simplify Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simplify Managed Futures has no effect on the direction of Credit Suisse i.e., Credit Suisse and Simplify Managed go up and down completely randomly.

Pair Corralation between Credit Suisse and Simplify Managed

Given the investment horizon of 90 days Credit Suisse X Links is expected to generate 1.26 times more return on investment than Simplify Managed. However, Credit Suisse is 1.26 times more volatile than Simplify Managed Futures. It trades about 0.28 of its potential returns per unit of risk. Simplify Managed Futures is currently generating about 0.03 per unit of risk. If you would invest  4,634  in Credit Suisse X Links on May 3, 2025 and sell it today you would earn a total of  851.00  from holding Credit Suisse X Links or generate 18.36% return on investment over 90 days.

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

Credit Suisse X Links  vs.  Simplify Managed Futures

Credit Suisse X

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Credit Suisse X Links are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Credit Suisse demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Simplify Managed Futures

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Simplify Managed Futures are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Simplify Managed is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Credit Suisse and Simplify Managed

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

The idea behind Credit Suisse X Links and Simplify Managed Futures 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.