Correlation Between Armada Hflr and COFACE SA
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and COFACE SA 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 Armada Hflr and COFACE SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and COFACE SA, you can compare the effects of market volatilities on Armada Hflr and COFACE SA 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 Armada Hflr with a short position of COFACE SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and COFACE SA.
Diversification Opportunities for Armada Hflr and COFACE SA
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Armada and COFACE is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and COFACE SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COFACE SA and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with COFACE SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COFACE SA has no effect on the direction of Armada Hflr i.e., Armada Hflr and COFACE SA go up and down completely randomly.
Pair Corralation between Armada Hflr and COFACE SA
Considering the 90-day investment horizon Armada Hflr is expected to generate 4.14 times less return on investment than COFACE SA. But when comparing it to its historical volatility, Armada Hflr Pr is 1.18 times less risky than COFACE SA. It trades about 0.01 of its potential returns per unit of risk. COFACE SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,319 in COFACE SA on September 24, 2024 and sell it today you would earn a total of 55.00 from holding COFACE SA or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.65% |
| Values | Daily Returns |
Armada Hflr Pr vs. COFACE SA
Performance |
| Timeline |
| Armada Hflr Pr |
| COFACE SA |
Armada Hflr and COFACE SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and COFACE SA
The main advantage of trading using opposite Armada Hflr and COFACE SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, COFACE SA 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 COFACE SA will offset losses from the drop in COFACE SA's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. Precinct Properties New | Armada Hflr vs. Global Net Lease | Armada Hflr vs. NexPoint Diversified Real |
| COFACE SA vs. Sterling Construction | COFACE SA vs. SENECA FOODS A | COFACE SA vs. National Beverage Corp | COFACE SA vs. Dairy Farm International |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |