Correlation Between Alstria Office and Air Products
Can any of the company-specific risk be diversified away by investing in both Alstria Office and Air Products 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 Alstria Office and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and Air Products Chemicals, you can compare the effects of market volatilities on Alstria Office and Air Products 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 Alstria Office with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and Air Products.
Diversification Opportunities for Alstria Office and Air Products
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Alstria and Air is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and Air Products Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products Chemicals and Alstria Office 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 alstria office REIT AG are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products Chemicals has no effect on the direction of Alstria Office i.e., Alstria Office and Air Products go up and down completely randomly.
Pair Corralation between Alstria Office and Air Products
Assuming the 90 days trading horizon alstria office REIT AG is expected to generate 0.64 times more return on investment than Air Products. However, alstria office REIT AG is 1.56 times less risky than Air Products. It trades about 0.04 of its potential returns per unit of risk. Air Products Chemicals is currently generating about 0.02 per unit of risk. If you would invest 529.00 in alstria office REIT AG on September 23, 2024 and sell it today you would earn a total of 232.00 from holding alstria office REIT AG or generate 43.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
alstria office REIT AG vs. Air Products Chemicals
Performance |
| Timeline |
| alstria office REIT |
| Air Products Chemicals |
Alstria Office and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and Air Products
The main advantage of trading using opposite Alstria Office and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| Alstria Office vs. Optima Health plc | Alstria Office vs. HCA Healthcare | Alstria Office vs. Cardinal Health | Alstria Office vs. Fevertree Drinks Plc |
| Air Products vs. FC Investment Trust | Air Products vs. Axway Software SA | Air Products vs. Livermore Investments Group | Air Products vs. Atresmedia |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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