Correlation Between CITY OFFICE and INTER CARS
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and INTER CARS 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 CITY OFFICE and INTER CARS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and INTER CARS SA, you can compare the effects of market volatilities on CITY OFFICE and INTER CARS 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 CITY OFFICE with a short position of INTER CARS. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and INTER CARS.
Diversification Opportunities for CITY OFFICE and INTER CARS
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CITY and INTER is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and INTER CARS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTER CARS SA and CITY 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 CITY OFFICE REIT are associated (or correlated) with INTER CARS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTER CARS SA has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and INTER CARS go up and down completely randomly.
Pair Corralation between CITY OFFICE and INTER CARS
Assuming the 90 days horizon CITY OFFICE REIT is expected to under-perform the INTER CARS. In addition to that, CITY OFFICE is 1.31 times more volatile than INTER CARS SA. It trades about -0.04 of its total potential returns per unit of risk. INTER CARS SA is currently generating about 0.24 per unit of volatility. If you would invest 11,860 in INTER CARS SA on November 7, 2024 and sell it today you would earn a total of 1,480 from holding INTER CARS SA or generate 12.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITY OFFICE REIT vs. INTER CARS SA
Performance |
| Timeline |
| CITY OFFICE REIT |
| INTER CARS SA |
CITY OFFICE and INTER CARS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITY OFFICE and INTER CARS
The main advantage of trading using opposite CITY OFFICE and INTER CARS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, INTER CARS 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 INTER CARS will offset losses from the drop in INTER CARS's long position.| CITY OFFICE vs. Siamgas And Petrochemicals | CITY OFFICE vs. AIR PRODCHEMICALS | CITY OFFICE vs. Summit Hotel Properties | CITY OFFICE vs. X FAB Silicon Foundries |
| INTER CARS vs. US Physical Therapy | INTER CARS vs. Phibro Animal Health | INTER CARS vs. CLOVER HEALTH INV | INTER CARS vs. PennantPark 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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