Correlation Between Rheinmetall and Lowland Investment
Can any of the company-specific risk be diversified away by investing in both Rheinmetall and Lowland Investment 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 Rheinmetall and Lowland Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rheinmetall AG and Lowland Investment Co, you can compare the effects of market volatilities on Rheinmetall and Lowland Investment 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 Rheinmetall with a short position of Lowland Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rheinmetall and Lowland Investment.
Diversification Opportunities for Rheinmetall and Lowland Investment
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Rheinmetall and Lowland is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Rheinmetall AG and Lowland Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowland Investment and Rheinmetall 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 Rheinmetall AG are associated (or correlated) with Lowland Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowland Investment has no effect on the direction of Rheinmetall i.e., Rheinmetall and Lowland Investment go up and down completely randomly.
Pair Corralation between Rheinmetall and Lowland Investment
Assuming the 90 days trading horizon Rheinmetall AG is expected to generate 3.43 times more return on investment than Lowland Investment. However, Rheinmetall is 3.43 times more volatile than Lowland Investment Co. It trades about 0.09 of its potential returns per unit of risk. Lowland Investment Co is currently generating about 0.07 per unit of risk. If you would invest 155,160 in Rheinmetall AG on August 20, 2025 and sell it today you would earn a total of 16,790 from holding Rheinmetall AG or generate 10.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rheinmetall AG vs. Lowland Investment Co
Performance |
| Timeline |
| Rheinmetall AG |
| Lowland Investment |
Rheinmetall and Lowland Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rheinmetall and Lowland Investment
The main advantage of trading using opposite Rheinmetall and Lowland Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rheinmetall position performs unexpectedly, Lowland Investment 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 Lowland Investment will offset losses from the drop in Lowland Investment's long position.| Rheinmetall vs. Gamma Communications PLC | Rheinmetall vs. Primary Health Properties | Rheinmetall vs. Inspiration Healthcare Group | Rheinmetall vs. Batm Advanced Communications |
| Lowland Investment vs. Rheinmetall AG | Lowland Investment vs. Silvercorp Metals | Lowland Investment vs. Europa Metals | Lowland Investment vs. Infrastrutture Wireless Italiane |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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