Correlation Between Materialise and CITY OFFICE
Can any of the company-specific risk be diversified away by investing in both Materialise and CITY OFFICE 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 Materialise and CITY OFFICE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Materialise NV and CITY OFFICE REIT, you can compare the effects of market volatilities on Materialise and CITY OFFICE 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 Materialise with a short position of CITY OFFICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Materialise and CITY OFFICE.
Diversification Opportunities for Materialise and CITY OFFICE
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Materialise and CITY is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Materialise NV and CITY OFFICE REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITY OFFICE REIT and Materialise 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 Materialise NV are associated (or correlated) with CITY OFFICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITY OFFICE REIT has no effect on the direction of Materialise i.e., Materialise and CITY OFFICE go up and down completely randomly.
Pair Corralation between Materialise and CITY OFFICE
Assuming the 90 days trading horizon Materialise NV is expected to generate 0.95 times more return on investment than CITY OFFICE. However, Materialise NV is 1.05 times less risky than CITY OFFICE. It trades about 0.0 of its potential returns per unit of risk. CITY OFFICE REIT is currently generating about 0.0 per unit of risk. If you would invest 898.00 in Materialise NV on October 14, 2024 and sell it today you would lose (198.00) from holding Materialise NV or give up 22.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Materialise NV vs. CITY OFFICE REIT
Performance |
| Timeline |
| Materialise NV |
| CITY OFFICE REIT |
Materialise and CITY OFFICE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Materialise and CITY OFFICE
The main advantage of trading using opposite Materialise and CITY OFFICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Materialise position performs unexpectedly, CITY OFFICE 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 CITY OFFICE will offset losses from the drop in CITY OFFICE's long position.| Materialise vs. Cars Inc | Materialise vs. ALEFARM BREWING DK 05 | Materialise vs. Geely Automobile Holdings | Materialise vs. Motorcar Parts of |
| CITY OFFICE vs. GEELY AUTOMOBILE | CITY OFFICE vs. Summit Materials | CITY OFFICE vs. NEWELL RUBBERMAID | CITY OFFICE vs. Materialise NV |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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