Correlation Between WIMFARM SA and APPLE HOSPITALITY
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and APPLE HOSPITALITY 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 WIMFARM SA and APPLE HOSPITALITY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and APPLE HOSPITALITY REIT, you can compare the effects of market volatilities on WIMFARM SA and APPLE HOSPITALITY 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 WIMFARM SA with a short position of APPLE HOSPITALITY. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and APPLE HOSPITALITY.
Diversification Opportunities for WIMFARM SA and APPLE HOSPITALITY
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between WIMFARM and APPLE is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and APPLE HOSPITALITY REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPLE HOSPITALITY REIT and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with APPLE HOSPITALITY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPLE HOSPITALITY REIT has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and APPLE HOSPITALITY go up and down completely randomly.
Pair Corralation between WIMFARM SA and APPLE HOSPITALITY
Assuming the 90 days horizon WIMFARM SA EO is expected to under-perform the APPLE HOSPITALITY. But the stock apears to be less risky and, when comparing its historical volatility, WIMFARM SA EO is 1.53 times less risky than APPLE HOSPITALITY. The stock trades about -0.19 of its potential returns per unit of risk. The APPLE HOSPITALITY REIT is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,322 in APPLE HOSPITALITY REIT on September 3, 2024 and sell it today you would earn a total of 187.00 from holding APPLE HOSPITALITY REIT or generate 14.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. APPLE HOSPITALITY REIT
Performance |
| Timeline |
| WIMFARM SA EO |
| APPLE HOSPITALITY REIT |
WIMFARM SA and APPLE HOSPITALITY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and APPLE HOSPITALITY
The main advantage of trading using opposite WIMFARM SA and APPLE HOSPITALITY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, APPLE HOSPITALITY 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 APPLE HOSPITALITY will offset losses from the drop in APPLE HOSPITALITY's long position.| WIMFARM SA vs. SALESFORCE INC CDR | WIMFARM SA vs. EHEALTH | WIMFARM SA vs. YATRA ONLINE DL 0001 | WIMFARM SA vs. SWISS WATER DECAFFCOFFEE |
| APPLE HOSPITALITY vs. Addus HomeCare | APPLE HOSPITALITY vs. Tri Pointe Homes | APPLE HOSPITALITY vs. HomeToGo SE | APPLE HOSPITALITY vs. ON SEMICONDUCTOR |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |