Correlation Between Addiko Bank and S IMMO
Can any of the company-specific risk be diversified away by investing in both Addiko Bank and S IMMO 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 Addiko Bank and S IMMO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addiko Bank AG and S IMMO AG, you can compare the effects of market volatilities on Addiko Bank and S IMMO 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 Addiko Bank with a short position of S IMMO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addiko Bank and S IMMO.
Diversification Opportunities for Addiko Bank and S IMMO
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Addiko and SPI is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Addiko Bank AG and S IMMO AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S IMMO AG and Addiko Bank 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 Addiko Bank AG are associated (or correlated) with S IMMO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S IMMO AG has no effect on the direction of Addiko Bank i.e., Addiko Bank and S IMMO go up and down completely randomly.
Pair Corralation between Addiko Bank and S IMMO
Assuming the 90 days trading horizon Addiko Bank AG is expected to generate 1.24 times more return on investment than S IMMO. However, Addiko Bank is 1.24 times more volatile than S IMMO AG. It trades about 0.09 of its potential returns per unit of risk. S IMMO AG is currently generating about 0.09 per unit of risk. If you would invest 915.00 in Addiko Bank AG on August 30, 2024 and sell it today you would earn a total of 985.00 from holding Addiko Bank AG or generate 107.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Addiko Bank AG vs. S IMMO AG
Performance |
| Timeline |
| Addiko Bank AG |
| S IMMO AG |
Addiko Bank and S IMMO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addiko Bank and S IMMO
The main advantage of trading using opposite Addiko Bank and S IMMO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addiko Bank position performs unexpectedly, S IMMO 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 S IMMO will offset losses from the drop in S IMMO's long position.The idea behind Addiko Bank AG and S IMMO AG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| S IMMO vs. CA Immobilien Anlagen | S IMMO vs. RATH Aktiengesellschaft | S IMMO vs. AT S Austria | S IMMO vs. BAWAG Group AG |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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