Correlation Between Aroundtown and Capital Properties
Can any of the company-specific risk be diversified away by investing in both Aroundtown and Capital Properties 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 Aroundtown and Capital Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aroundtown SA and Capital Properties, you can compare the effects of market volatilities on Aroundtown and Capital Properties 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 Aroundtown with a short position of Capital Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aroundtown and Capital Properties.
Diversification Opportunities for Aroundtown and Capital Properties
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aroundtown and Capital is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Aroundtown SA and Capital Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Properties and Aroundtown 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 Aroundtown SA are associated (or correlated) with Capital Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Properties has no effect on the direction of Aroundtown i.e., Aroundtown and Capital Properties go up and down completely randomly.
Pair Corralation between Aroundtown and Capital Properties
If you would invest 1,267 in Capital Properties on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Capital Properties or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Aroundtown SA vs. Capital Properties
Performance |
| Timeline |
| Aroundtown SA |
| Capital Properties |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aroundtown and Capital Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aroundtown and Capital Properties
The main advantage of trading using opposite Aroundtown and Capital Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aroundtown position performs unexpectedly, Capital Properties 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 Capital Properties will offset losses from the drop in Capital Properties' long position.| Aroundtown vs. Asia Pptys | Aroundtown vs. Adler Group SA | Aroundtown vs. Aztec Land Comb | Aroundtown vs. Ambase Corp |
| Capital Properties vs. Community Bancorp | Capital Properties vs. F M Bank | Capital Properties vs. ENB Financial Corp | Capital Properties vs. CreditRiskMonitorCom |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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