Correlation Between INVITATION HOMES and Socit Gnrale
Can any of the company-specific risk be diversified away by investing in both INVITATION HOMES and Socit Gnrale 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 INVITATION HOMES and Socit Gnrale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INVITATION HOMES DL and Socit Gnrale Socit, you can compare the effects of market volatilities on INVITATION HOMES and Socit Gnrale 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 INVITATION HOMES with a short position of Socit Gnrale. Check out your portfolio center. Please also check ongoing floating volatility patterns of INVITATION HOMES and Socit Gnrale.
Diversification Opportunities for INVITATION HOMES and Socit Gnrale
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INVITATION and Socit is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding INVITATION HOMES DL and Socit Gnrale Socit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit Gnrale Socit and INVITATION HOMES 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 INVITATION HOMES DL are associated (or correlated) with Socit Gnrale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit Gnrale Socit has no effect on the direction of INVITATION HOMES i.e., INVITATION HOMES and Socit Gnrale go up and down completely randomly.
Pair Corralation between INVITATION HOMES and Socit Gnrale
Assuming the 90 days horizon INVITATION HOMES is expected to generate 2.31 times less return on investment than Socit Gnrale. But when comparing it to its historical volatility, INVITATION HOMES DL is 1.82 times less risky than Socit Gnrale. It trades about 0.03 of its potential returns per unit of risk. Socit Gnrale Socit is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,646 in Socit Gnrale Socit on September 13, 2024 and sell it today you would earn a total of 36.00 from holding Socit Gnrale Socit or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INVITATION HOMES DL vs. Socit Gnrale Socit
Performance |
| Timeline |
| INVITATION HOMES |
| Socit Gnrale Socit |
INVITATION HOMES and Socit Gnrale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INVITATION HOMES and Socit Gnrale
The main advantage of trading using opposite INVITATION HOMES and Socit Gnrale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INVITATION HOMES position performs unexpectedly, Socit Gnrale 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 Socit Gnrale will offset losses from the drop in Socit Gnrale's long position.| INVITATION HOMES vs. American Homes 4 | INVITATION HOMES vs. Superior Plus Corp | INVITATION HOMES vs. SIVERS SEMICONDUCTORS AB | INVITATION HOMES vs. NorAm Drilling AS |
| Socit Gnrale vs. THORNEY TECHS LTD | Socit Gnrale vs. LG Display Co | Socit Gnrale vs. Sportsmans Warehouse Holdings | Socit Gnrale vs. Universal Entertainment |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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